Sustainability is not a word often associated with the mining sector; however, the space has strived to adopt an environmental and social lens to development.
The International Council on Mining and Metals (ICMM) helps miners engage in these environmental, social and governance (ESG) initiatives, a global organization created to facilitate, assist and monitor the growing transition to resource projects that value community stakeholders and adhere bylaws.
At this year’s Prospectors and Developers Association of Canada convention, held in mid-June, the Investing News Network (INN) spoke with Rohitesh (Ro) Dhawan, CEO of the ICMM, on the 20th anniversary of his organization, his goals for the coming years and how the mining sector is essential to the global transition towards decarbonization and electrification.
INN: Can you tell us what ICMM is and what is your goal?
Ro Dhawan (DR): ICMM simply represents the commitment to sustainability of the world’s largest mining companies. 26 companies make up the ICMM. Together, they make up about one-third of the global mining and metals industry. And between them, they have 650 locations in over 50 countries.
The ICMM is the collective commitment of these companies to operate in the most sustainable and responsible way. We therefore make voluntary commitments about the things we will do to ensure that when we mine, the benefits of mining are maximized and any negative impacts are minimized. These commitments then become conditions of membership. Each CIMM company undertakes to respect them. We encourage the adoption of these commitments by companies that may not be ICMM members, but certainly share the principles and values of sustainable and responsible mining.
Quite simply, ICMM represents the industry’s commitment to operating with principles.
INN: Today (June 15) is actually ICMM’s 20th anniversary, and I was wondering if you could tell us what you’ve seen change in the mining sector during this time, and where you hope he will go in the future?
DR: Well, Toronto, and Canada, is so important to us, because the signing of the Toronto Declaration goes back 20 years, and that’s what led to the creation of the ICMM as an organization. At the time, the reason ICMM was created was because industry leaders at the time felt we were out of step with society’s expectations of us. Over the past 20 years, the organization has worked hard to make the kind of commitments and the transparency that you correctly pointed out – to demonstrate to our stakeholders that we will do everything we can to try to operate in the way that as responsible as possible.
I am really proud of the progress we have made in many areas. But I also recognize that there is still a long way to go. I’m really proud, for example, that for nearly 18 years we’ve made a commitment not to mine or prospect in World Heritage sites. So, no matter how rich the resource or how great the need, we believe that some parts of the world are so critical that they must remain no-go zones.
And here we are today in 2022, in the throes of a great crisis of nature, the sixth mass extinction, and it demonstrates how this commitment has been both timely and timeless. And we’ve continued to build on that kind of commitment for the future. But we are really leading the way not only for our industry, but also for other industries, to make sure that certain areas remain fully protected. We committed last year that all ICMM companies will have net zero greenhouse gas emissions by 2050, or sooner, to meet the Paris targets. And that really fits the moment of the climate challenge we are facing.
But for one example where we haven’t gone as far as necessary, the industry still has a long way to go on issues of diversity, equity and inclusion. Only around 15% of the global mining workforce is made up of women. We know that the results for members of the BIPOC community, for women, for underrepresented groups, are still grossly unfair. And so today, we are truly proud to say that we have made a series of new commitments on this very day that will see us take action to build truly diverse, equitable and inclusive societies.
INN: We often hear that the majors are leading the way when it comes to ESG. During a panel yesterday (June 14), we heard from some very innovative juniors talking about the ESG initiatives they are working on. Do you think it’s easier for juniors to pivot into this role, or does it need a top-down approach?
DR: I was incredibly inspired to hear some of the work that junior mining companies are doing to integrate ESG directly into their business models from the start. In that respect, yes, juniors have the opportunity to fully embed ESG into the core of the business and operating model in a way that may be a bit more difficult for majors to do, as majors try to shape and tilt really big organization.
That said, of course, juniors often face greater capacity and resource constraints than majors. So it’s challenging on both sides, but it’s also incredibly exciting and energizing. Just to give you an example of an incredibly innovative junior mining company that embeds ESG at the heart of its model, it’s Sigma Lithium (TSXV: SGML, NASDAQ: SGML). Sigma is one of the largest producers of hard rock lithium in North America. They had the opportunity to build a lithium project by creating a super pit – a giant hole, basically – that would allow mining and the way they mine to be simple and efficient. Instead, what are they doing?
They created two separate pits with a thin piece of land preserved between a north pit and a south pit. But why did they do this? It certainly wasn’t more efficient. It certainly wasn’t easier to mine, it wasn’t cheaper. The reason they did this was that this small piece of land that ran through the pit was the base of a perennial river. This river both had deep cultural significance for the communities that live downstream, but was also an essential source of water. So they had options available to them. They could divert the river, yes, they could move the community. But instead, after talking to the community, they realized how important this water source was.
So what did they do? They changed the whole plan of the mine. Now they have incurred short-term costs. If all you had done was say, “I want to maximize my profit tomorrow,” you wouldn’t have chosen that option. But they were enlightened. They thought, well, what matters to us is the health and wellness communities and the long-term viability of our business. And so they designed this project from the start with that at their heart.
It’s not something a major could do. Granted, when you’re doing a brownfield or greenfield project, you often have the opportunity to reflect, but that thought wouldn’t even cross your mind If you didn’t have the value system that makes you look outside of your own interests to understand what matters to other people.
INN: During your panel, you mentioned the circular economy of a mine. How can miners bring this to the table when working on life of mine plans?
DR: The circular economy is an economy in which we do not take, produce or waste; we reduce, reuse and recycle. It is a cornerstone if we are to achieve the goals of the Paris Agreement, but also if we are to contain and reverse the decline of nature. You might think, “Oh, so a circular economy is where we reuse things and use less stuff. Surely the mining industry must not like this, because it must mean lower demand for primary metal.”
Absolutely not. For us, because we want to see a safe, fair and sustainable world, we are absolutely committed to making our contribution to the circular economy, and the best way we think we can contribute is to provide a stock of sustainable materials. The advantage of metals and minerals is that you can recycle them almost endlessly. Two-thirds of the copper we have produced in the world since 1900 is still in circulation. We have aluminum and steel which are almost infinitely recyclable. But lithium, for example, we don’t recycle a lot of yet. So we need systems to recycle. But before you can recycle and reuse, you need a stockpile of minerals. So our goal is to supply the stock of minerals in a truly responsible way and then help the world and help the system understand how to reuse and recycle those minerals. Deep down, we understand the metal so well because we helped extract it.
We are ready to play our part in making sure a circular economy is possible, which means both supplying the metal and then making sure it is properly recirculated.
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Securities Disclosure: I, Georgia Williams, have no direct investment interests in any of the companies mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or completeness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the views of Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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