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ACACIA’S RESPONSIBLE

SUPPLY CHAIN

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CONTENTS

Acacia’s Three Pillars ........................................................................................................ 3

About Acacia Mining ........................................................................................................ 4

Acacia’s Supply Chain Mission .......................................................................................... 5

Acacia’s Supply Chain Objectives ..................................................................................... 5

Acacia’s Responsible Supply Chain ................................................................................... 6

The right goods and services ............................................................................................ 7

The right quality and value ............................................................................................... 8

The right timeframe ......................................................................................................... 8

Managing and Building Partners ...................................................................................... 9

Acacia’s Supplier Expectations ......................................................................................... 9

Supplementary Information ........................................................................................... 11

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Acacia’s Three Pillars Our approach to operating our assets has focused on three specific areas:

Our business

We have made significant technical changes to the way we have engineered each of our Tanzanian mining operations:

At Bulyanhulu, we have moved to a mechanised mining method, with long hole stoping becoming the primary mining method. This will assist in the ramp up of the mine and is both safer and more cost effective than previous hand-held methods

At North Mara, we have commenced production from a new underground operation at the Gokona deposit. We believe that this will be more profitable than mining the deposit via an open pit and has a much lower impact on the community. The Gokona underground will operate in tandem with the Nyabirama open pit.

At Buzwagi, we have shortened the life of the mine so that we are mining only profitable ounces. The life of mine plan is expected to generate positive cash flow over each year of its remaining life.

Our people

We have a very strong focus on our people, who are our core asset. We have significantly reduced the levels of management; restructured our corporate offices; and many of our employees have completed a cultural transformation programme, ‘Together We Succeed’ or ‘Tufanikiwe Pamoja’ (in Swahili), and a behavioural safety programme, ‘We Care’ or ‘Tunajali’ (in Swahili). We are focused on creating a high performing culture where our people are held accountable, but are given the tools to succeed. As part of this process we have already uncovered real talent emerging from within the workforce as well as seeing talented people returning to Acacia.

Our relationships

There has been a strong focus on improving the relationships with the communities around our mines and exploration areas, and with the relevant governments. We have become very proactive with our public profile in the community, in the media and with our broader stakeholders. We have also worked hard to build our relationships with local and national Government officials in order to ensure that we receive the appropriate support to ensure our business can continue to be a key economic development driver for our host countries.

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About Acacia Mining Acacia Mining plc (Acacia) is a leading African focused gold miner committed to operating and exploring in a safe and sustainable manner.

We have been operating in Tanzania for over a decade and during that time have produced nearly 8 million ounces of gold from our combination of open pit and underground mines, making us the leading gold producer in Tanzania.

Currently, all of Acacia’s mining operations are in Tanzania, a country consistently ranked highly in Africa in terms of political stability with a history of democratically elected governments. The country has an established legal and regulatory framework for mining companies and has built up a 15 year history of commercial gold mining. We have three producing mines (Bulyanhulu, Buzwagi, and North Mara), all located in northwest Tanzania.

Additionally we hold a number of exploration licenses, covering nearly 7,000 square kilometres (plus ~700 square kilometres under application) across four African countries. These areas of exploration are located around the major gold-mining projects in the Lake Victoria greenstone belt of Tanzania, and in some highly prospective regions of western Kenya, western Burkina Faso, and western Mali. From this base, we are also well placed to continue widening our interests into other parts of Africa.

Acacia Mining plc is a UK public company with its headquarters in London. We are listed on the Main Market of the London Stock Exchange under the symbol ACA and have a secondary listing on the Dar es Salaam Stock Exchange in Tanzania.

In everything we do, we aim to act responsibly towards our people, the environment and our communities. This sits at the heart of our culture, and our license to operate depends on it.

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Acacia’s Supply Chain Mission Using a collaborative relationship between our customers, supply partners, and supply chain team, we will ethically source the right goods and services, of the right quality and value, within the right timeframe.

Acacia’s Supply Chain Objectives We are a dynamic Supply Chain team that anticipates emerging needs and delivers exceptional service anywhere, anytime, to ensure we provide our customers with a value-added service by:

Developing new strategies and working with our customers to continually assess the appropriateness of the services to meet their targets;

Accurate and timely procurement of goods and services, which are ethically sourced and meet budgetary requirements and company standards;

Improving and growing supplier relationships, especially within Tanzania, to demonstrate excellence, fairness, and integrity in all aspects of supply chain.

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Acacia’s Responsible Supply Chain Acacia’s Responsible Supply Chain is our statement of business practice as it relates to our Supply Chain function.

It outlines our Supply Chain standards and processes. It has been written to ensure that the manner in which procurement and contracts are conducted is transparent and understood by all key Acacia stakeholders.

Acacia’s Responsible Supply Chain sets out a range of expectations and commitments pertaining to how business will be conducted between our centralised procurement team, our mine and exploration sites, and all our contractors and suppliers.

This document outlines our supply chain process and details the standards that we require from our suppliers and contractors, as well as our employees.

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The right goods and services Acacia’s Supply Chain team develops and executes sourcing strategies for goods and services on behalf of, and in consultation with its customers.

Knowing the Market

As a pre-requisite to any significant sourcing exercise, a marketplace analysis is performed. A marketplace analysis is a detailed review of the total available supply and the total estimated demand for a particular product in a given market. This process enables our Supply Chain team to get to know and understand, in a specific geographic area, all our key suppliers, their value offerings, their demand and overall direction in which the market is heading. Marketplace analysis identifies the market dynamics so that we can make an educated supply decision based on the current supply and demand forecast figures.

Global vs. Regional vs. Local

Acacia’s Supply Chain group operates at the local, regional and global level. Regional or global sourcing results are used to increased leverage. Increased leverage gives better pricing, stronger contractual agreements and stronger relationships.

However, the development of Local Suppliers of goods and services not only leads to better delivery conditions and easier contract management, but it helps develop a partnership commitment from the local communities to our operations (both our mine sites and our exploration areas).

We have a “Source Local First” supply chain policy. This means that, all other things being equal, preference should be given to companies from (in preferential order):

1. Our operation’s immediate impact area;

2. Our operation’s local district or region;

3. The country of our operation (as opposed to a country office of a multinational company).

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The right quality and value Competition – Sourcing the Best

In order to solicit the best products and services for the best value, Acacia has a competitive sourcing process. Whenever practical the supply chain process will go through competitive sourcing.

Pre-qualification and accreditation of suppliers and contractors are considered critical to ensuring the safety and quality of goods and services delivered to our customers, and may be conducted before suppliers / contractors are accepted into a supply chain process.

Supplier / contractor quotes and proposals are assessed in a consistent manner using criteria that were established prior to them being received. Evaluation criteria are developed in cooperation with all relevant Acacia stakeholders. Quotes and proposals are evaluated using the concept of the lowest total cost of ownership and the ability of the supplier / contractor to meet the specified requirement in the time period needed. The Acacia Supplier Expectation section (below) outlines what we expect from our suppliers and contractors, and how we expect them to act.

Care is taken to maintain a level playing field to ensure a fair chance for all potential suppliers / contractors.

The right timeframe Logistics and Human Resources are key to remote mining

All of the Acacia mining and exploration operations are situated in remote African locations. Getting the right supplies and/or contractors to these areas can be the difference between a profitable site and an unprofitable site. Our Supply Chain team works closely with our freight forwarding partners to ensure the items are delivered when they are needed. Similarly, our Supply Chain team engages with Acacia’s Human Resources and Legal teams to assist contractors meet the country’s employment and immigration legislation, and to ensure fair and equitable contracts between both parties.

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Managing and Building Partners Acacia takes a partnership approach to sourcing. A supplier is seen as a ‘strategic partner’ who needs to be developed and managed to ensure best value for both sides of the relationship. In developing these strategic partnerships, we look for companies who are willing to not only supply, but to support, the goods and services they have supplied long after the original order. When we find a strategic partner, we will enter into a long term contract or forward pricing agreement, showing our commitment to the relationship and we expect that a similar commitment to be returned.

Acacia’s Supplier Expectations Safety First

Acacia has a ‘Safety First’ philosophy. This is integrated into every aspect of our business and how each of our employees conducts themselves while performing their duties.

It is a strict Acacia requirement that our contractors have the same safety attitude. This means that all suppliers are expect to meet our safety standards on site as well as follow the Safety First attitude while conducting business with us.

Environment

As a minimum we require our contractors to maintain a consistent record of compliance with all our environmental requirements whilst demonstrating a strong commitment to:

responsible environmental management;

elimination of environmental incidents;

waste minimisation;

responsible resource utilisation; and

remediation of damage caused by operations and incidents.

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Business and Employee integrity, corporate governance

and transparency

It is imperative that Acacia, our employees and our contractors / suppliers:

undertakes business with integrity, honesty and fairness at all times;

endeavours to build from a foundation of compliance with relevant local laws and regulations and international standards;

seeks to avoid conflicts of interest;

supports free and fair competition and prohibits bribery, in all its forms; and

ensures all payments (direct or indirect), are made solely for legitimate business services at a rate that reflects their market value.

We require all contractors / suppliers to sign up to our Supplier Code of Ethics. This gives us a commitment from the contractor / supplier that they will act in the manner expected by Acacia. If a contractor / supplier is found not to have acted in this manner and breaches the supplier code of ethics, then we may take action to end the business with that particular contractor / supplier.

Supplier Standards

Acacia strives to build a partnership with our major contractors / suppliers. These strategic relationships are based on mutual benefit and centred on contractor / supplier standards. We focus on the following areas when selecting strategic partners:

Aligns with Acacia business objectives;

Willing to contract under Acacia terms and conditions;

Financially security;

Builds and trains national workforce, and operates fairly under national employment legislation;

Manufacturer / OEM, not a buying house or trader;

Robust quality assurance and quality control procedures;

Ability to undertake electronic procurement and payment.

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Supplementary Information Acacia puts all public information on our website www.acaciamining.com. Stakeholders can find additional information about Acacia and the way we operate our business within this website.

Disclaimer

The policies and procedures in Acacia’s Responsible Supply Chain are internal documents and we are not required to disclose any documents we elect to withhold from any external party.

The policies and procedures in Acacia’s Responsible Supply Chain are a guide only; they are not intended to create any contractual obligations or rights. We reserve the right to interpret our policies and to vary our procedures as we deem appropriate. We may, at our sole discretion, change, make exceptions to, or discontinue any of the provisions in this document at any time, without advance notice. Acacia hereby expressly disclaims all liability and responsibility arising from any reliance placed by any third party on the information contained in this document, or by anyone who may be informed of any of its contents.

Document Updated

4 November 2015