Natural resources have the potential to drive growth, human development, and poverty reduction in many countries. But for a very long time, ‘gold mining’ and ‘sustainable socio-economic development’ were seen as a contradiction in terms. Now, the mining industry is at an inflection point. Mining operations can be clean, safe, and sustainable to achieve long-term socio-economic progress.
By virtue of their day-to-day operations and mining footprint, companies in the extractive industries are inherently exposed to substantial environmental, social, and governance (ESG) risks. These revolve around the toxicity of emissions, water use, general ecological impact, and community relations.
As more and more entities worldwide highlight their ESG standards, sustainability has gone from being a mere buzzword in the mining industry to a term that has firmly entrenched itself within the investor lexicon. Investors are looking to evaluate corporate behaviour and better understand the risk management processes of mining operators. Institutional investors’ growing interest in ESG performance is reflective of the pressure brought on by shareholders, consumers, employees, and wider society.
Governments have also upgraded regulatory mechanisms and mining standards following a number of destructive tailings dam failures. Mining disasters call into question the role of mining operators’ management of their facilities. Many countries have implemented Mining Codes on par with reporting standards found in Organisation for Economic Co-operation and Development (OECD) member jurisdictions, such as Australia’s JORC Code, Canada’s CIM Guidelines, and Chile’s Certification Code. Political impetus to better regulate the industry echoes the growing societal concern over the mining industry’s ecological footprint, driving higher expectations for the corporate sector to address these challenges and to be held to account.
The pursuit of continual improvement in the health and safety of the mining community, with an ultimate goal of zero harm, is categorically the right thing to strive for. Mining operators have also realised that good ESG performance can safeguard their long-term success by opening doors to a larger pool of capital and a diversified investor base. Conversely, actual or perceived non-compliance with ESG regulations and best practices may lead to such companies being shunned by higher-quality, more patient capital. This has made ESG performance and compliance to mining regulations an imperative at the highest level in the boardrooms of mining corporates.
Gold mining companies have come to realise the need to integrate sustainable practices in their operations. This entails the use of cyanide-free and mercury-free gold recovery reagents, the implementation of effective risk-management strategies, and the elimination of tailings dams that contain toxic slurries. With new, environmentally-friendly solutions, such as Clean Earth Technologies’ non-toxic gold recovery reagent that allows for the safe and sustainable extraction of gold from ore, the gold mining industry is at the dawn of a new era, where opportunities to realise positive impact and reduce the mining footprint will contribute to the socio-economic development of mining communities.
Mining companies that carry out activities without regard for socio-environmental concerns will invariably cause harm to the environment, the community, and their bottom-line. But if they observe high ESG standards in their core business, these mining companies can realise the industry’s contribution to sustainable socio-economic progress in mining communities.