Governance

Cameco has a strong commitment to good governance in all areas of our business. We believe it is a critical factor in achieving investor confidence and essential to running our operations responsibly.

Managing our responsibilities

Our commitment to sustainability starts at the top, with our board of directors.

Sustainability reporting is overseen by Cameco's board of directors. The board executive and its committees set annual corporate targets, evaluate our performance and determine executive incentive rewards – all based on our performance against the four Cameco measures of success.

Management provides strategic and operational leadership under the guidance of the board, using a quality management system to guide every aspect of our work, and an enterprise risk management program to systematically identify and manage the risks associated with our business.

Development of the report is carried out by a number of corporate teams including safety, health, environment and quality (SHEQ), environmental leadership (EL) and corporate social responsibility (CSR). These teams also support our corporate responsibility programs, initiatives and ongoing improvements day to day.

Policies and standards

Our corporate social responsibility (CSR) policy defines what CSR means to Cameco and how we implement it. It's supported by our code of conduct and ethics and six other internal and public policies that guide how we work and interact with our stakeholders:

• Community investment
• International business conduct
• Procurement of goods and services
• Respectful workplace
• Safety, health, environment and quality (SHEQ)
• Talent acquisition and recruitment program

In 2012, we will formalize our approach to identifying community interests by introducing company standards for engaging aboriginal and local communities. These will complement the community engagement provisions in our corporate social responsibility policy.

About our CSR policy

We updated our corporate social responsibility policy in December 2011 and will be launching it across all of our managed operations and subsidiaries in 2012.

It includes commitments to:

• comply with all applicable laws and regulations where we operate
• conduct regular internal and external audits of our business and operations
• release a bi-annual sustainable development report aligned with key performance indicators that are relevant to our business, including GRI and corporate indicators
• proceed in good faith and use our influence to encourage partners and co-owners to adopt practices consistent with our policy, where we have only minority ownership or share operational control of a business or entity.

Community investment policy and guidelines

This internal policy outlines our eligibility guidelines for donations and sponsorships. It identifies our commitment to investing in four target areas:

• youth
• education and literacy
• health and wellness
• community development

Procurement of goods and services

This internal policy reflects our desire to contribute to the communities where we work and live by “buying locally”. It identifies our expectations for quality and other things related to ensuring the goods and services we purchase from local vendors and suppliers meet minimum standards and serve our business needs.

Talent acquisition and recruitment program (formerly the recruitment and selection policy)

We have a standard hiring program that applies to human resources employees and hiring managers at all our sites. This internal program provides guidelines for recruiting and hiring employees and for managing performance expectations once an employee is hired. It includes commitments to:

• confidentiality
• hiring decisions that reflect Cameco's workforce diversity goals
• fair performance management practices (coaching, feedback, performance improvement).

Management systems

Two management systems help us manage risk in a formal and consistent way:

• safety, health, environment and quality (SHEQ) management system
• enterprise risk management (ERM) system

Safety, health, environment and quality management system

The primary system used for managing sustainable development responsibilities at all our operations. It includes our statement of principles, and programs for implementing our sustainable development policies and commitments.

Safety, health and environmental principles

Five principles guide our approach to safety and environmental responsibility:

• preventing injury, ill health, and pollution;
• complying with and moving beyond legal and other requirements;
• keeping risks at levels as low as reasonably achievable;
• ensuring quality of processes, products and services; and
• continually improving our overall performance.

These principles are supported by seven programs that address quality control and key operational risks and requirements across our business.

Enterprise risk management system (ERM)

Our ERM system identifies risks that are significant to Cameco as a whole. We apply a systematic process to record, track and review identified risks, and our board of directors oversees the process to make sure risks are managed responsibly and effectively.

Our risk management system feeds into our annual strategic planning process, where we identify potential threats to our business that must be addressed and opportunities to advance and improve it.

Assessment and decision making

Evaluating projects in a way that considers their environmental, social and financial impacts strengthens our business and our reputation. This approach is standard practice for all of our major projects.

The Pembina Institute's Life Cycle Value Assessment (LCVA) process is a rigorous, systematic approach to analysis and decision making that takes a holistic look at financial, social and environmental risks and benefits. Because it considers more than economics alone, it helps us more effectively assess environmental and social impacts and risks and objectively considers concerns our stakeholders may have, leading to better business decisions and a more transparent decision-making process. Our environmental leadership team facilitated the development and integration of the LCVA tool in 2008 and it has gradually gained wider acceptance and use in the organization, particularly in our major projects division. With LCVA, we are able to demonstrate that we've considered our investments carefully, with equal care and attention to all three aspects of the triple bottom line – something that is good for our relationships, our reputation and the long-term success of our business.

Incident reporting and corrective action

All of our operating sites have applied the Cameco corrective action process since 2007.

Benchmarked to the nuclear power plant model and adapted for use at our operations, our corrective action process offers a consistent, systematic approach to recording, tracking and  classifying the severity of all types of non-conformance with Cameco policies and standards, the laws and regulations of the jurisdictions we operate in, and the terms and requirements of our operating licences. It allows us to systematically investigate accidents and other incidents, identify effective corrective actions, track their implementation and share information across Cameco's operations.

Specialists at each site use the corrective action process to make sure there is appropriate incident investigation and follow up and to promote a healthy reporting culture. They report regularly to site management, using minor incident trends to identify areas that may benefit from proactive attention and actions – one of the ways we work diligently to prevent small problems from becoming larger ones.