Effective ESG strategies to set your business up for sustained success
Updated: Jul 19, 2021
Mining has powered economic growth for centuries, but now that the impact of extracting minerals on the planet is widely recognised, the sector is facing increasing pressure to reduce and decarbonise their activities. Policymakers and society are pressing change, threatening mining companies license to operate. According to a recent study by EY, social license to operate is now seen as the largest risk in the mining sector. Investors and shareholders are increasingly conscious of environmental issues and are now pushing companies to disclose consistent, comparable and reliable data. According to a global survey by McKinsey on valuing ESG programs, 83% of C-suite leaders and investment professionals say that they expect that they would be willing to pay about a 10 percent median premium to acquire a company with a positive record for ESG issues over one with a negative record. Moreover, investors are analysing ESG performance and ratings as a proxy for good decision making and risk management.
In order for mining to become truly responsible, it needs long term commitment, support and leadership from all stakeholders, inclusive of mining companies, investors and regulators. To date, this has proven difficult, in part due to differing opinions on how responsibility might be interpreted, measured and rewarded between these stakeholders. Attempts to reconcile initiatives have been welcomed, but so far frameworks have not always provided enough practical change in operations and footprint.
At Satarla, we have provided the means for different stakeholders to contribute to the same a conversation, which has produced a repository of up-to-date intellectual capital that can be tapped, so that it is possible to develop a streamlined, industry-accepted notion of responsible mining, with specific criteria and qualification methodology. As a result, we have established a bespoke global network of senior leaders from across the mining industry, as well as key stakeholders and investors, to come together and engage in regular high-end discussions, debates and idea sharing, to align themselves with a common set of guidelines and standardisations that define what responsible mining is, tangible benefits of this approach and how to do it.
As part of Responsible Raw Materials recent activities, we hosted our annual 2021 ESG Toolbox for Responsible Sourcing conference, which brought together industry experts from across the entire value chain of raw materials, including the likes of miners, active investors, financiers, governments and academia to share their latest knowledge, ideas, tools and frameworks in ESG management. Our primary aim was to provide the industry with a set of tools to achieve and maintain their ESG objectives.
We summarised our data collection in the below infographic and highlighted a few key takeaways from our series of insightful discussions underneath, which are free to view by clicking on the blue hyperlinks:
Meaningful sustainability assessments need to be top to bottom in the strategy and culture of companies – Tobias Kind-Rieper, WWF
Incorporating ESG at the earliest opportunity brings about positive impacts on the financial side, as well as encouraging minimised footprints, zero emissions, and safe and smart use of technology - Jon Russill, Cathryn MacCallum & INFACT team
Working collaboratively with stakeholders and regulators in the countries you serve will help you develop tailored plans that best suit their unique attributes and economies – Sarah Weber, C3 Alliance
Rethinking the models and systems in which we operate is key, as is shifting away from financial value to shared value, and shareholder capitalism to stakeholder capitalism. Engagement of communities should allow participative decision making – Rachel Dekker and Liz Freele, Sympact
The identification and understating of risk is pivotal to ensuring strong ESG practices through the understanding of how different stakeholders perceive these risks (Enterprise Risk Management) – Sarah Gordon, Satarla
To build strong and positive ESG principles, we must start to listen to individuals outside of our industry, address their concerns and then follow up by applying these principles – ‘Bursting the Bubble’ panel session
Whilst data is powerful for making good decisions in the ESG space, data management is key, and bringing mindset and diversity together gives you greater flexibility to overcome the inherent complexities of a system – Rob Palfrey, Minerva
Local procurement is a key pillar for both creating host country benefits and securing a social license to operate in the mining sector – Jeff Geipel, Mining Shared Value
Leveraging the likes of satellite data will both limit the possibilities of greenwashing and better inform decision makers with direct measuring of superseding estimates and models, for a more efficient and focused outcome – Gareth Morgan, Terrabotics
In order to meet the demands of population growth and new technologies, including powering the green economy, and to ensure efficiency and business growth means that society is going to continue using non-renewable natural resources for centuries to come.
Given the highlighted similarities of this year’s conference, it was evident that for us to really move the dial forward as an industry, we will need to be more collaborative with our approach, enhance the effectiveness of our communications, and have convenient access to reliable and trustworthy data to allow objective monitoring and validation of our ESG performance.
For further tips, techniques and insights from our annual 2021 ESG Toolbox for Responsible Sourcing conference and to explore about how we can support your company with a sustainable ESG strategy, please feel free to visit our website here: https://www.responsiblerawmaterials.com
If you'd like to chat about any aspects of this article, please feel free to get in touch with us: firstname.lastname@example.org
References  https://www.ey.com/en_gl/mining-metals/10-business-risks-facing-mining-and-metals  https://www.mckinsey.com/business-functions/sustainability/our-insights/the-esg-premium-new-perspectives-on-value-and-performance#