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Human Rights

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Human Rights Commitment and Initiatives

Freeport-McMoRan Copper & Gold Inc. and PT Freeport Indonesia have made strong, unequivocal commitments to human rights. This commitment is expressed in a Company policy, formally adopted by both the Board of Directors of Freeport-McMoRan Copper & Gold Inc. and the Board of Commissioners of PT Freeport Indonesia, to conduct our operations in a manner consistent with the Universal Declaration of Human Rights (discussed below), to educate our employees about human rights, and to protect any employee who reports suspected violations. We require appropriate personnel to certify annually that they have neither participated in nor are aware of any human rights violation. If a human rights violation is reported, information about that violation would be forwarded to the Indonesian Human Rights Commission. Contractors and privatized companies serving PT Freeport Indonesia must also comply with this policy or implement their own similar policy.

Our policy was refined and strengthened in 2004 by adding more detailed language on human rights and security and expanding on the human rights reporting policy and annual certification process. The purpose of the amendments was to improve implementation of the policy by clarifying how it is applied to employees, social interaction with the community and Company conduct with regard to human rights and security. The revised policy is included in the appendices to this report.

In 2004, PT Freeport Indonesia conducted training on the Company's Social, Employment and Human Rights Policy with over 5,000 employees. We also prepared a video explaining the policy and how it applies to employees for regular broadcast over the Company's closed-circuit television station. Our annual Social, Employment and Human Rights Compliance Certification was completed in 2004 with 100 percent of the respondents reporting compliance.

We have also joined other mining and oil and gas companies and human rights organizations in endorsing the joint U.S. Department of State-British Foreign Office Voluntary Principles on Human Rights and Security. These principles are included in the appendices to this report. Twice each year, participants in the voluntary principles program meet to review their implementation and to seek better ways to provide security for extractive industry operations around the world to protect employees and investments while assuring the highest level of human rights compliance. Freeport-McMoRan Copper & Gold Inc. representatives regularly participate in these meetings.

Overseeing the development and implementation of our policy on human rights is an internationally recognized expert, Judge Gabrielle Kirk McDonald. Judge McDonald has been a distinguished civil rights attorney and U.S. federal judge and formerly served as President of the International Criminal Tribunal for the former Yugoslavia. She serves as Special Counsel on Human Rights to Freeport-McMoRan Copper & Gold Inc. and is an Advisory Director for the Company. Judge McDonald reports regularly to the Board of Directors of Freeport-McMoRan Copper & Gold Inc. on human rights issues and developments.

A team from the International Center for Corporate Accountability visited with local leaders during a comprehensive audit of the effectiveness of PT Freeport Indonesia’s Social, Employment and Human Rights Policy.

Social and Human Rights Performance Audit

Our Social, Employment and Human Rights Policy reflects high standards for the social and economic development of the people within PT Freeport Indonesia's Contract of Work area; the commitment of the Company to the increased employment of native Papuans, both in number and positions of authority; and the respect for and protection of the human rights of employees, their dependents and the local community around our operations. We recognize that effective implementation of our policy is required for its goals to be met. Freeport- McMoRan Copper & Gold Inc. and PT Freeport Indonesia retained the International Center for Corporate Accountability (ICCA) to conduct a comprehensive audit in 2004 of the effectiveness of our policy and the extent of our compliance.

During 2004, teams from ICCA traveled to Papua to gather both quantitative and qualitative data for the audit report. Operational areas included were security, human resources, industrial relations, training, and social, health and educational programs. Over 400 interviews were conducted with employees to ascertain their understanding of the policy and their perceptions of PT Freeport Indonesia's compliance with the policy. Based on the extensive data collected, ICCA will report its findings to the Company, noting areas where improvements are needed. The Company will respond with a plan to implement required improvements. Both ICCA's report and the Company's response will be made public in 2005.