Sustainability Series 6: Series Recap

We have recently completed the publication of five reports on mining sustainability, delivered over the course of 2020. The reports have attempted to examine mining sustainability in a concise manner and with a focus on some of the key issues currently impacting mining companies and commodities. This report highlights some of the key takeaways of the previous reports and considers the more recent impact of the COVID-19 pandemic.

Sustainability and COVID-19: In less than a year the world has changed dramatically. Any conversation today about sustainability would be inseparable from the sweeping social and economic effects of the COVID-19 pandemic. The majority of the world’s population continues to be subject of some kind of restrictions due to the pandemic and the number of global cases continues to rise.

The Impact of the Pandemic on Mining: The pandemic has affected the mining industry and commodity markets in a number of ways. Many mining operations have been temporarily disrupted as a result of coronavirus outbreaks, closed because of government mandated shutdowns, and affected by breakdowns in supply chains. At the same time, the demand for many commodities has fallen and demand growth is expected to be lower in the near term. Meanwhile, it appears that the mining industry has quickly taken measures to protect the health and safety of employees and local communities and support suppliers.

How will the Pandemic Impact Sustainability? The impact of the pandemic on ESG and climate change remains unclear. The pandemic could increase awareness of environmental risks and bring about a shift in consumer preferences, corporate actions, and investor behaviour that could accelerate the transition to a low-carbon economy. However, there is a risk that financially weakened firms, amidst heightened economic uncertainty, will reduce their investments in long-term, capital-intensive sustainability projects, slowing down the transition.

The Task Ahead for the Mining Industry: Whatever the outcome, the urgent need to reduce global greenhouse gas emissions has not gone away and remains a key issue facing the world. Mining companies face a difficult transition and uncertain path to zero carbon emissions and were already underperforming other industries against most key assessment indicators in respect of ESG and climate change implementation before the pandemic. The pandemic likely means that the task has become more difficult. Additional work is now required to progress ESG standards and reporting, a greater response to climate change risks is needed, and the continued introduction of new technology and the decarbonisation of mining operations is essential.

The Stakes Remain High: The transition must be achieved with enhanced disclosure, verification, and transparency. The stakes are high for everyone, and the industry must move quickly. Mining companies are under pressure from all sides and the industry must credibly show that mining can takes place responsibly and in a sustainable manner.

For the full 14page report please click here.