...Majumdar Course Instructor BRACU Business School BRAC University Prepared By Shiab Khan (13164039) Sanzida Parvin (13164025) Tanzir Islam (13164087) SK Yaishi Binte Zaman (12264035) Ahammed Riaz(13164009) Date of Submission: April 2, 2015 BHP Billiton Limited Introduction: BHP Billiton is world’s largest diversified natural resources company. The company was created by the merger of two companies, BHP Ltd (An Australian mining company) and Billiton PLC (An UK based Company). BHP Billiton has created long time share holder value through the discovery, acquisition and development of natural resources. In the last few years, BHP Billiton has faced some governance challenges in conducting their business around the world. For overcoming those challenges several strategic drivers has been taken by BHP Billiton. This report mainly focused on external and internal environment, strength and weakness, Governance challenges and strategic drivers of BHP Billiton. Overview of BHP Billiton: BHP Billiton is a Dual Listed Company (DLC) comprising BHP Billiton Limited and BHP Billiton Plc. BHP Billiton was created through the DLC merger of BHP Limited (now BHP Billiton Limited) and Billiton Plc (now BHP Billiton Plc), which was concluded on 29 June 2001. BHP Billiton is a leading global resources company. The purpose is to create long-term shareholder value through the discovery, acquisition, development and marketing of natural resources. BHP Billiton are among the world’s largest producers...
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...accounting technique should to be integrated into BHP Billiton’s contemporary management accounting system. Through in depth research this technique has been identified as the environmental management accounting technique. This result was achieved through the research of the strengths, weaknesses, opportunities and threats (SWOT) analysis and the identification of the critical success factors. A balanced score card was then created using the information gathered to be used in identifying the most relevant technique. EMA was the technique decided upon as compared to the other techniques as it is the most relevant to BHP Billiton as their industry deals day to day with the environment and society. It will create awareness for the harm that is being done to the environment and will encourage them to create the minimum damage to the earth. It will also assess any repercussions of their actions that may affect society and bring harm to people. By integrating the EMA technique, it will help the organisation to collect the most relevant information to their situation and will assist in the planning, controlling and decision making within that organisation. This will improve the organisations strategy in which to help preserve the environment and also affect their financial state positively. TABLE OF CONTENTS EXECUTIVE SUMMARY 3 TABLE OF CONTENTS 3 1. INTRODUCTION 5 2. BHP BILLITON LTD 5 2.1 SWOT ANALYSIS 5 2.2 CRITICAL SUCCESS FACTORS...
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...Group Assignment: BHP BILLITON International Business Theory & Practice (MGF 5966) Lecturer/Tutor Mr. Sharif Rasel Name & ID Junaidul Haque – 263 512 50 Dalaphone Phengrattanavong – 266 785 94 Girish Balar – 274 718 53 Maike Nan – 263 994 90 Due Date – Week 11 Introduction BHP Billiton, which is Broken Hill Proprietary Billiton, is an Anglo-Australian multinational mining and petroleum company. BHP started its operation in Melbourne in 1885 which is one of Australia’s largest and oldest companies, and it focused on development, discovery, production, and marketing of natural resources. In value-added flat steel products, BHP was also a market leader. In 1860, Billiton was established in The Hague, Netherlands. Billiton developed a growing and substantial copper portfolio. It was also a global leader in the metals and mining sector, and a major producer of aluminum and alumina, steaming coal, nickel, and titanium, chrome and manganese ores and alloys. BHP Ltd of Australia and Billion Plc of UK established merger in 2001, and the result was the dual listed company (DLC). BHP Billion becomes one of the world’s largest mining and Petroleum Company. It expands its business in twenty countries, and its major commodities are iron ore, metallurgical coal, energy coal, conventional and unconventional oil and gas, copper, aluminum, manganese, uranium, nickel, and silver. This essay will deeply analysis the effects of BHP Billiton’s sustainability practice...
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.....................................................................................2 1.1 Motivation..................................................................................................................................2 1.2 Problem Statement .....................................................................................................................2 1.3 Methodology ..............................................................................................................................2 1.4 Delimitations..............................................................................................................................3 2. Industry Analysis .................................................................................................................................3 3. BHP Billiton ........................................................................................................................................4 3.1 Background ................................................................................................................................4 3.2 Financial Standing .....................................................................................................................4 4. Rio Tinto ..............................................................................................................................................5 4.1 Background ..............................................................................
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...provides an analysis and importance of CSR reporting in mining industry, how well companies disclose social and environmental issue according to GRI guidelines. This article’s main focus is to describe trends of CSR reporting in mining companies in Australia. This article provides detailed overview of companies reporting format and structure, CSR disclosing motivation, how well company account for job losses and impact of reduction of oil price on companies. The purpose of this report is to describe CSR practice of mining companies in Australia and highlights the importance of sustainability reports regarding social and environmental perspective. This report is based on two major mining companies namely BHP Billiton and Rio Tin. The information used for writing this article is gathered from different researcher, annual reports, newspapers, and online articles, GRI guideline. Only Secondary data used to write report and study based on ASX registered companies companies in Australia are more aware of GRI reporting standards now and also know that how crucial it is to report on the sustainability issues from social and environmental perspective to have long term business and secure future. . Contents Executive Summary i Contents ii Introduction 3 Question a 3 Question b 5 Question c 7 Question d 8 Question e 9 Conclusion 11 Reference List 12 Introduction Corporate social responsibility is a business approach...
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...1 Analyzing the external environment 1 Demographic 1 Economic 1 Socio-culture 2 Political-legal 2 Global 2 Technological 2 External environment conclusion 2 Industry analysis 3 Profit pool 3 Porter five forces 3 Threat of new entry 3 Bargaining power of suppliers 4 Bargaining power of buyers 4 Threat of substitute products 4 Rivalry among competing firms 4 Industry analysis conclusion 4 Competitor analysis 4 Analyzing the internal environment 5 Tangible resources 5 Intangible resources 6 Value chain analyzing 6 Capabilities 6 Core competencies 7 Weaknesses 7 Current strategy 7 Future strategy 8 Concluding remarks 8 References 9 Introduction Fortescue Metals Group: The new force in iron ore is a new company in the Australia with new vision. It was founded in 2003 with the aim of lowest cost producer in order to complete with large players of industry. Its main customer is China. Its lowest cost structure is main reason behind getting huge business from china. It had to faced many challenges in the industry but its strong policies supported company to make its distinct position in the industry Analyzing the external environment Every business/ company has external environment with some positive and negative points. Below is the analysis of Fortescue external environment. Demographic According to information in case there was no much diversity in the demographic environment. Company operates in Australia and trains...
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...Financial Statement Analysis: WOW, BHP and TSE compared Introduction Financial statements are often called “the language of business.” Thus, any leader in every area of business and non-profit management will need to know and understand how to read, analyse, and interpret the meaning and decision making implications of financial statements. Every accountant and financial analyst will need to be able to calculate financial ratios and analyse related non-financial data in order to see whether the company is successful or not and suggest what can be improved in the operations if needed. Therefore, there was thorough financial investigation of BHP Billiton, Transfield Services Limited and Woolworths Limited. In order to investigate these companies activity, the 2008 and 2009 annual reports were retrieved from official companies’ websites. Also general information on industry averages for various ratios was obtained from financial websites as well as ASX website. Specific events that could have impacted a company’s operations were followed on the related web-links. In order to make a financial decision, financial analysis of financial ratios was conducted. In order to have the most necessary information following ratios were considered to be most important in making investment decision - profitability ratios that measure a company’s earning ability, in the broad categories of margins and returns. The major margins in our case were gross profit and net profit margin...
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...Introduction There has been considerable debate on how dividend policy affects a firm’s value. Researchers such as Gordon (1959) believed that dividends increase shareholders wealth, Miller and Scholes (1978) considered dividends to be irrelevant and others such as Litzenberger and Ramaswamy (1979) thought that dividends decrease shareholders wealth. As a result, a number of studies have been undertaken to solve the “dividend puzzle”, a concept which tries to answer the question of whether paying dividends actually makes a difference or not. Many economists argue that dividends should not have any effect on the investor’s valuation of the company because the investor is an owner of the firm and should be indifferent to either getting the dividends or having them reinvested in the firm. The above conclusion, nevertheless, has proven futile as, in the majority of the cases; investors do demand some type of a dividend payment (Cohen, 2002). As a result, it’s important for firms to have a dividend policy in order which will help them make decisions regarding paying cash dividend in the present or paying an increased dividend at a later stage. The Determinants of Dividend Policy An optimum dividend policy is one that strikes a balance between current dividends and future growth and should be based on two basic objectives – maximizing the wealth of the firm’s owners and providing sufficient funds to finance growth. The determinants of a firm’s dividend policy are discussed below...
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...ACFI1001 – Individual Project Financial Statement Analysis and Report Base company – BHP Billiton Ltd. Comparison company – Orica Ltd. The 2012 annual reports for BHP Billiton Ltd and Orica Ltd were sourced and analysed with the relevant sections presented in Appendix A. The main featuresof the statement of financial performance for BHP Billiton that were focused on are profit after taxation, revenue from production and the dividends per ordinary share. The profit after taxation is an important figure for an investor as it represents the money made by the company taking into account its expenses. In the year ended 30th June 2012, BHP Billiton had a profit after taxation of $15,532 (US$M), which was a 35% decrease from the year prior, and a 19% increase from the year ended 2010. This clearly shows that BHP Billiton’s performance related to profit after taxation has significantly deteriorated from 2011 to 2012. The revenue from production is another important value for investors as it explains in more detail why the profit after taxation changes from year to year. For BHP Billiton, the revenue from production increased from 71,739 (US$M) in the year ending 2011 to 72,226 (US$M) in 2012, which is a slight improvement in performance. However by looking at the revenue from production and profit after taxation together, it can be seen that even though the revenue increased slightly, the increase in expenses was relatively much higher resulting in the profit after taxation...
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...Social Responsibility as Capability The Case of BHP Billiton Leeora D. Black Australian Centre for Corporate Social Responsibility; and Faculty of Business and Economics, Monash University Corporate social responsiveness is what companies do in order to be socially responsible. This paper presents a case study of social responsiveness at the global mining firm BHP Billiton to illustrate a model of social responsiveness capabilities. Until now, corporate social responsiveness has described processes of environmental scanning, issues management and stakeholder management. The model presented here suggests that social responsiveness is rather understood as a cluster of five organisation-level capabilities that span an organisation’s culture and structure. The case study explores evidence for social responsiveness capabilities at BHP Billiton and considers management implications for the development of management abilities for social responsibility. Director of the Australian Centre for Corporate Social Responsibility, Dr Leeora Black is a consultant, researcher and educator focused on integrating social responsibility into business operations and strategies and measuring corporate social responsibility. Her work analyses complex CSR issues and problems and builds organisational CSR capabilities. She works with global firms, government businesses and social-sector organisations on integration of CSR into business operations and strategies, CSR measurement, stakeholder...
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...RESOURCING THE FUTURE WHO WE ARE About Us BHP Billiton is the world’ largest diversified natural resources company, with a network of 100,000 emploees and contractors in over 25 countries, and is involved in over 100 operations. Our organization is an Australian based company created through the dual listed companies merger of BHP Limited and Billiton Plc in 2001. We pursue a strategy of developing a diversified portfolio of quality ‘tier one assets’ including Steelmaking products, Nonferrous products, Energy products. 10,000 employees and contractors profits of $13 billion (June 2010) world’s largest mining company measured by revenue world's third-largest company measured by market capitalization – value of $165 billion (June 2010) WHY CHINA & POTASH Mining industry potential China is rich in natural mineral resources and are widely deposited throughout all provinces. In fact due to the industry and the construction sector, China’s natural resources account for 48.6% of China’s GDP. However the lack of adequate, advanced technologies, hinder the development of the mining industry and as a result, most of China's mineral potential remains unexploited. An abundance of non-metallic mineral deposits China is one of the few countries in the world that contains a wide range of non-metallic mineral deposits. China has vast quantities of over 5000 non-metallic mineral reserves, one of which is Potash. China has a great demand for natural resources After...
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...looking to more sustainable products or services in order to keep their company running long into the future. BHP Billiton has taken one such initiative, as one of the largest mining companies, it understands the importance of the environment to big business, both social, environmental and economical, therefore has been producing readied sustainability reports for the past 3 years. Sustainability strategy BHPs sustainability strategy is incorporative of how they can match their capabilities to accomplish its objectives but without compromising their or futures generations ability to use their opportunities to achieve their goals in the marketplace. They have done this through four main foundations in which it is trying to improve sustainability; they include safety, healthcare, environmental effects and lastly the community at large. Safety is an important factor for BHP as it is a large mining company many of the jobs include some level of risk. There official motto for safety is “we do not compromise our safety values”. They planned to have Zero fatalities and a reduction in recordable injuries through identifying the effective risk controls, and eliminating the root of these injuries, as seen in this table below. Healthcare is a contributing factor to BHPs successes as a healthy workplace is more efficient then an unhealthy one, this is because BHP “seeks ways to improve the health of our workforce and the community”. They...
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...companies BHP Billiton and Rio Tinto and analyse their cash flow statements. The analysis requires evaluating the cash flow performance of these companies during the global financial crisis 2007- 2009.The global financial crises were originated in US because of the bloom/bubble in the housing prices. During global financial crisis many financial institutions failed to recoup their money from lenders and finally ended up declaring bankruptcy. The purpose of the cash flow statements is to provide information about the changes to an entity’s cash and cash equivalents over certain period of time. The cash flow from operating activities of the both companies shows both positive and negative signs as the companies were going through recession. Whereas both companies used external and equity source financing and thus made an efficient cost effective decisions from which BHP Billiton benefited the most. Finally it’s concluded that the both companies were successful in overcoming global financial crisis and alternative strategies affecting the profitability of the companies were presented. Introduction Last three years has faced the worst global financial crisis after the great depression of 1929-1933. The origin of global financial crisis was mainly in US starting from mid 2000’s and taking the whole world into account by the end of 2007. The main reason of the crisis was unsecured lending and then the failure of recovering it back. The purpose of this report is analysis the...
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...ACCTG20040 Auditing and Ethical Practice Assessment item 1: Term 3, 2013 Understanding Companies and Their Business Risk Prepared by: Timothy Supandji Table of Contents EXECUTIVE SUMMARY 3 Factors in understanding company and business risk before accepting as New Client 4 Comparison of the Overall Financial Conditions of BHP Billiton Ltd and Rio Tinto Limited during the GFC 6 Explanation of risks associated with BHP and Rio Tinto Ltd during GFC 8 Managing Business Risk: BHP Billiton Ltd Vs Rio Tinto Limited 10 CONCLUSION 11 EXECUTIVE SUMMARY There are four purposes for this report. It attempts to provide description of what factors that the auditors need to consider in understanding a company and assessing business risk before attempting any audit work on a particular client. The second aim is to explain the comparison of financial conditions between BHP Billiton Ltd and Rio Tinto Limited during the Global Financial Crisis that occurred in 2007 to 2008. Further, the risk that is associated with BHP and RIO during the Global Financial Crisis will be explained. Finally, this report intends to explain of which company is better in handling and managing the business risk during the Global Financial Crisis. Factors in understanding company and business risk before accepting as New Client Generally speaking, at the time when there was a Global Financial Crisis, it has detrimental effect to the companies globally with downfall of share prices. Because...
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...Summary The world's biggest miner BHP Billiton (BHP) is cutting jobs at its coal mines after closing a loss-making mine thoroughly in Queensland early this year (Stewart 2012). BHP's job cuts is accompanied by other global mining companies such as Rio Tinto to confront a retrogressive market with falling industrial commodity prices and increasing costs. The future of Australia's mining boom which is largely dependent on Chinese demand for commodities driven by its economic growth is of particular concern (Stewart 2012). Application of Concepts Both economic environment and the concept of corporate social responsibility (CSR) can be demonstrated in this article. In particular, the nature of BHP's mining business, which is regarded as a significant contributor to Australian economy (Maddock and McLean 1987) determines its need to pay close attention to the opportunities and threats posed by the global economic environment (Blainey 2003). For example, slowdown in China's economic growth and recent European economic recession have impact on Australia's resource exports (Stevens 2012). The Australian mining industry which has once benefited from the surge in demand driven by the rapid growth of emerging economies in Asia since 2003 and the shortage of global supply (Stevens 2012) is now facing a difficult period signaled by the drop of China's GDP growth from 10 per cent to a mere 8 per cent (Connolly and Orsmond 2011). China's demand for resources has declined as a result...
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