Miners cherry-picking on ESG efforts: RMF

Mining companies are being selective in which ESG issues they choose to address, says the RMF

Miners cherry-picking on ESG efforts: RMF

The Responsible Mining Foundation (RMF) has warned that ESG objectives pledged in boardrooms aren't trickling down into operational progress at the site level. 

The organisation's Responsible Mining Index (RMI) 2022, which assessed 40 companies and 250 mine sites, found that 94% of mine sites scored an average of less than 20% on 15 standard ESG metrics. 

It said only a minority of mine sites showed any evidence of having implemented corporate protocols. Additionally, there are "inconsistent efforts across different issues", which the RMF suggested shows mining companies are selective in which ESG issues they choose to address. 

The RMF said better transparency around how individual mines perform and more accountability at the corporate level would benefit the company as a whole, including workers, investors, and affected communities. 

This measure will be key to improving ESG output as it would enable year-on-year comparisons and performance tracking, the body added. 

"For example, showing several years' data in the same document to enable comparisons over time, providing data as absolute numbers rather than relative rates, providing contextual information and making data as up-to-date as possible," it said. 

The RMF explained that instead of aggregating ESG data from their operations to show only company-wide statistics in their public reporting, companies should provide the mine-site-specific data to meet the needs of stakeholders, including affected communities, workers, investors, and others interested in site-level risks and performances. 

Pierre De Pasquale, Head of Stakeholder Engagement at the RMF, said mining companies should move beyond consolidated reporting and aggregate figures to meet stakeholders' needs for relevant information and meaningful engagement. 

"By tracking and documenting the extent to which corporate systems (guidelines, requirements, management standards, etc) are being implemented across all mine sites, companies can more readily identify any gaps to be addressed," De Pasquale told Mining Magazine

Additionally, by improving transparency at the site level, mine operators will be able to apply sustainability and development goals (SDG) practices consistently across their operations. 

The more transparent reporting of data will also help them avoid the risk of "perceived SDG-washing" if they proactively report data on negative impacts, as well as positive ones. 

The path to better transparency

While ESG commitments are standard across the industry, implementation and performance tracking remain weak, the RMF said. If miners are to achieve their ESG goals, they must ensure those who are responsible for doing so must be given the necessary budgets and agency. 

As part of the drive towards greater transparency and accountability, the RMF said mine operators should designate specific board members and senior executives as responsible for the company's overall performance, with relevant remuneration publicly disclosed. 

The resultingly more accountable and cohesive corporate strategy would align with evolving societal expectations for mining companies, the RMF claimed. 

Such expectations include examples such as preparedness for pandemics, assessing the implications for workers as mines become more automated, protecting the deep sea, and cutting waste. 

"If a company leadership is serious about ESG and sustainability, these areas need to be provided with the finances, people, agency and respect required to ensure effective management of ESG issues," De Pasquale said. 

"In addition, companies can bring sustainability into the C-suite for stronger governance, accountability and signalling." 

According to De Pasquale, the surge in mining companies' profits and ramped sustainability ambitions means they should be impeded when achieving ESG ambitions and that there is "an urgent need for a similar level of effort and leadership to ensure responsible practices and harm prevention across operations. 

"Looking at the results of the RMI Report 2022, it does not seem that current levels of technology or innovation represent a limitation for better ESG performance," De Pasquale noted. 

Furthermore, De Pasquale also stated that previous studies showed that sufficient and better ESG performance is not an unobtainable achievement for smaller and mid-tier mining companies, as greater transparency and public reporting would enable improvements across the industry.

 "Whether large or small, all mining companies are encouraged to normalise harm prevention and adopt as quickly as possible the good examples shown by their peers."



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