The industry is traditionally seen as opaque and insular with companies myopically focused on the bottom line to the detriment of environmental and social impact concerns. Further, anti-mining activists posit that the interests of large-scale mining companies, government, mining communities and labour are often unaligned.
There are also mining communities who often, due to lack of proper expectation setting by investors and governments, have unrealistic expectations for what dividends can be derived from mineral development, which in turn result in negative views of the mining investor.
Some combination of these views may well be the case today, but disruptive technologies may upend the dynamics of stakeholder relations in the future of mining. If (a big if since culture is the primary determinant) mining stakeholders are intentional in their response to this technology-driven future, such a response could bring about a change in the traditional insular culture of the industry.
Robotics-based automation, unmanned aerial vehicles, artificial intelligence and cellular network-enabled IOT are some of the technologies disrupting the traditional methods of mine development, from prospecting to reclamation.
With these phenomena leading to seemingly fantastical realities/possibilities, such as a personnel-less mine, a significant change in the socio-economic formula for mineral development is afoot.
With the decline of extensive human labour for ore excavation or haulage truck driving, which in turn increases safety and productivity in mining; a demand for more technologists such as robotic engineers in the sector rather than old school geologists; and increased use of UAVs for exploration and operations monitoring, among other things, mines are starting to look different.
However, the industry would be remiss to ride this wave of change without a cultural shift that will serve its long-term interests.
Here are three brief ideas that companies can apply to shape the industry's cultural shift.
Committed support for an equitable regulatory regime: Countries continue to review and revise the regulatory framework for mineral development as debates around smart regulation percolate. This suggests that a region like Africa, which largely applies a contractual regime to the industry, may ultimately turn to a regulatory regime as it better refines the regulatory framework.
In turn, disruptive technology is catalysing the emergence of legal and policy issues that need to be addressed beyond domestic borders to enable the private sector to thrive such as data governance.
For example, with respect to data custody, where exploration companies could easily carry physically produced data out of countries, drone-obtained data may now be impacted by data localisation laws that have not fully considered the implications for specific sectors of broad responses to disruptive technologies.
Currently, mining companies are seen to have a negative reflex to any government attempt to review their mining regulatory framework to approximate the desired socio-economic benefits of the sector. This automatic negative response is seen by the host communities and some civil society organisations to be solely for the purposes of protecting indefensible rates of profit margin without any consideration for a shared value approach. At best, they are seen to concede to shared value principles as a grudge purchase that provides them with a social license to operate.
Nneoma V. Nwogu, senior counsel, World Bank To be fair, governments may in pursuit of a principled approach to equitable mineral development, in some instances, take approaches that could frustrate the economic/financial viability of the sector. In those instances, mining companies can still profess a commitment to a shared value approach as an internalised organising principle while outlining the considered limitations of a proposed change to the law. That is not the case today.
Ultimately, in a mining future transformed by disruptive technologies, companies should proactively seek a seat at the table with all stakeholders to develop a shared value approach to mineral development that results in smart laws that work for all stakeholders and not only shareholders.
Use of social media as a tool: It is evident that mining companies do not command a positive global image. And mining accidents, while arguably fewer when compared to design-related auto accidents, can be so fatal as to remain indelible in the global consciousness.
Mining companies are doing little to change that image even though today's world could not, in fact, function without mining. Instead, they seem like the Beast in Beauty and the Beast, opting to stay hidden in corporate castles licking their public relations wounds.
The negative image of mining need not remain the case in a disruptive technology-driven world. In our partially social media-driven reality, mining companies should be proactive in using social media as a tool, not for image building per se but for a needed recharacterisation that is fueled by real transparency.
Social media can be an effective portal for information sharing and public engagement. For example, companies can share health and safety and environmental metrics to show compliance with environmental and social impact assessments (as communities and regular citizens often have little information, even if they are consulted on ESIAs) on how the environmental and social impacts are being handled on an ongoing basis.
With respect to the Extractive Industries Transparency Initiative (EITI) standard and mandatory payment disclosure laws, companies could proactively disclose information required on their payments to governments in formats meant to engage citizens. Further, companies can proactively engage with communities to find out what kinds of information would be useful and important for them so that shared information can be useful and genuinely facilitate a collaborative relationship between communities, governments and mining companies.
In a world of Twitter, Facebook and Instagram, it is inevitable that social media will facilitate a more diffused form of operations monitoring in mining locales. Companies that anticipate and even go further to pioneer such an approach in collaboration with regulators will contribute to a different narrative on the character of mining companies, while using such processes to create a real-time feedback loop for engaging with stakeholders both in mineral development and import locations.
Pursuit of a public-private partnership (PPP) approach to training for the sector: With the inadequacy of capacity and the dislocation of labour as central to the discourse regarding the impact of disruptive technologies in many sectors, both in the developed and developing world, there is a consensus around the need to revamp education and skills training. It is no different for the mining sector.
To provide the requisite labour for the fourth industrial revolution, education strategy should be coordinated as a public-private partnership, where companies will be partners in addressing the outcomes of a technology disrupted mining future. Companies can partner with regulators through sharing the data on needed skill sets, facilitating practitioner presence beyond company trainings into classrooms, as well as providing hands-on experiential training.
In the end, "culture eats process" is a famous adage attributed to Peter Drucker, a management expert who argued that culture is a powerful force that will time and again override a process-led approach to change. While technologies can transform processes in the industry, a perceived culture of opacity and contrarian stance towards or grudging acceptance of environmental and social interests may yet persist. It need not be the case for the sector. Mining companies can re-conceive of themselves to be at once a necessary catalyst and champion for modern sustainable human existence.
The future culture of mining and the consequent narrative of the industry can be different if companies are game and ready to disrupt not only processes but culture.
Nneoma V. Nwogu is a senior counsel, World Bank, legal advisor to the WB Extractives Global Practice and co-lead of the WB Disruptive Technology and Innovation Legal Group.
Join us at Future of Mining Americas on the 29-30 October, 2018, in Denver, Colorado, US, where Nneoma Nwogu is taking part in a keynote panel on ‘Cultural Shift - Leading Change in Mining'.
For more information on this year's programme and speaker line-up please click here.
