The conversation in the mining industry around sustainability has matured. It has moved from a general acknowledgment to a point where the industry recognises that it is now a pre-requisite for doing business.
Asked about his overall impression of the Financial Times Summit, Thomas noted how the industry’s relationship with investors and ESG is changing rapidly and at the highest level, commenting: “The sessions left me in no doubt; the conversation in the mining industry around sustainability has matured. It has moved from a general acknowledgment that mining must become more sustainable to a point where the industry recognises that it is now a pre-requisite for doing business. Sustainable practices are increasingly non-negotiable in order to secure investment, meet society’s evolving expectations, gain licence to operate and to ultimately ensure shareholder value.“
Sustainability gives customers an opportunity to earn more money. And it doesn't matter if it is by avoiding costs, risks or through more or better output – there is a commercial impact across all of these areas.
The industry is putting sustainability as a business objective
This viewpoint was in stark evidence across many sessions at the summit from the first speech. In the opening keynote, Mike Henry, Chief Executive Officer at BHP, for instance, pointed out the essential role played by mining in delivering economic development and improvements in living standards globally, adding that there is “no choice about whether mining happens – but there is a choice about how it happens and who does it”.
In a noteworthy speech, Henry stated: “Global growth, decarbonisation, renewables, electrification… none of this happens without the commodities we produce. The only choice for the industry and the world is how we do this.” He went on to explain that overall standards must continue to rise and that the mining industry needed to ensure we are operating ever-more sustainably and that it is creating value for all our stakeholders. Investors, he correctly noted, have a role to play in this as they reinforce these trends by differentiating between “leaders and laggards”.
The sentiment of Mike Henry’s speech was welcomed by Thomas Schulz, who elaborated that sustainability and social best practices are no longer seen as costs to business but rather as requirement and, crucially, a business opportunity for the industry. “In short,” Thomas explained, “sustainability gives customers an opportunity to earn more money. And it doesn't matter if it is by avoiding costs, risks or through more or better output – there is a commercial impact across all of these areas. At the Summit it was obvious that the industry is pretty much united in seeing this. “
The industry is moving in the same direct – but we need to learn from each other
Mark Cutifani the Chief Executive Officer at Anglo American, was another big voice that addressed the ESG topic, underlining the importance of working with groups such as the ICMM if the industry is to lift the bar for all mining operations and to set higher setting standards. He also emphasised how miners needed to support each other in areas where they don’t compete, like safety and the environment and social issues.
Cutifani also urged miners to “think more like B2C companies” – to think about the commodity’s journey through the supply chain all the way to the consumers, stating: “The consumer is interested in providence – they want to be sure they are comfortable with where the product has come from and that it was mined ethically and sustainably.”
Cutifani’s colleague, Froydis Cameron-Johansson, Group Head of International and Government Relations at Anglo American, came back to some of these points, pointing out that pressure is coming from all fronts, all the way to the consumers of end products and that the mining industry must have trustworthy certification processes and standards.
Thomas Schulz participated in the “Technology: Rethinking Mining" panel session with Accenture's Rachael Bartels, Vale's Alexandre Pereira, Anglo American's Digital Head, Arun Narayanan and Komatsu Mining CEO Jeffrey Dawes. The panel was focused on technology and the strong correlation between tech and sustainability was in evidence throughout. Solutions such as dry stack tailings and IPCC as methods to reduce water use and emissions respectively were raised frequently. Also notable were strong statements around the employment of data for optimisation and efficiency.
Our MissionZero programme is needed by the industry. It will be part of the re-think that will help secure investment, future-proof our customers and ensure a minimised environmental footprint.
One particular point in the session really chimed with Thomas Schulz: “The idea that mining must re-examine the entire mining process to uncover ways to optimise resource use and cut waste was the most importance concept expressed on the panel. I steadfastly support this idea – a radical transformation of mining processes is needed to meet the needs of society and evolving mineral demand. We must be up to this challenge and use all the tools available – from digital efficiency and data analytics to new ways of approaching old challenges and a fundamental re-think of the flowsheet. What has worked before will not be enough to meet the new demands on out industry – from customers, end users, regulators, investors and society at large.”
For Thomas Schulz ESG plays an important role in this process: “From what I heard at the conference, there is a hunger to take this on. There is a singular desire to move the needle of the mining industry when it comes to everything related to ESG and beyond, and to do this at the quicker pace.
“From the perspective of FLSmidth, it was reassuring to be part of this conversation and to hear so many key industry leaders make these statements. It reinforced our belief that the MissionZero programme – to enable our customers to move towards zero water and energy waste and well as cutting emissions by 2030 – is needed by the industry. It will be part of the re-think that will help secure investment, future-proof our customers and ensure a minimised environmental footprint. Happily, we are increasingly preaching to the choir it seems – and that is nothing but a positive note for us, our customers and our industry.”