This blog is part of a series, “Unlocking Indigenous Potential in Mining Regions”. The Series focusses on opportunities for Indigenous-led development in regions characterised by
natural resources.
The demand for critical minerals is expected to increase between twofold and fourfold by 2040 to supply the necessary materials for electric vehicles and renewable energy technologies. This will require new mining projects, with resource extraction expected to increase by 60% by 2060.
Over the past few decades there have been significant strides in terms of how mining companies manage environmental and social responsibilities and respond to local communities. Going forward, the industry must remain committed to continual improvement and ensure alignment with interests of local actors and implementation of robust environmental practices.
Yet there is increasing consumer and investor focus on social responsibility, environmental protection, and ethnical governance. Environmental, social and governance (ESG) standards are now being integrated into the financial and operational activities of the mining industry with 82% of companies now reporting on ESG matters.
Global ESG standards, like the Global Reporting Initiative, Initiative for Responsible Mining Assurance, and Towards Sustainable Mining (TSM) are making a difference, provide a framework to evaluate companies’ environmental impact, social responsibility, and governance to promote sustainability and ethical conduct.
While ESG reporting tools are helpful, improving company’s ESG performance on the ground requires strong cooperation between local communities and the private sector.
ESG standards in action: TSM
Launched 20 years ago in Canada, Towards Sustainable Mining (TSM) is a performance-based standard, requiring mining companies to evaluate, manage and publicly report on their environmental and social impacts. It mandates site-level reporting with external verification and multi-stakeholder oversight, adopted by mining associations in 13 countries, including key mining jurisdictions such as Australia, Mexico, Brazil and Colombia. It measures companies’ responsibility based on a framework with nine protocols on various topics from Indigenous relationships to responsible tailings management.
Ensuring ESG activities are tailored to local needs
While ESG reporting tools are helpful, improving company’s ESG performance on the ground requires strong co-operation between local communities and the private sector. This includes ensuring ESG activities align with regional development goals and are co-designed with relevant local partners. For instance, for mining operations in close proximity to Indigenous communities, TSM requires companies to implement the Indigenous and Community Relationships Protocol, which has been designed in collaboration with Indigenous representatives and includes detailed criteria related to impact management, benefit sharing, and collaborative decision making.
TSM also relies on the oversight of a network of national Community of Interest (COI) Panels, which include voices from Indigenous groups, local communities, environmental and social NGOs, and labour and financial organisations. The Canadian Panel includes a representative affiliated with the Nunatsiavut Government, a former Chief of the Cooks Ferry Indian Band and a Métis Nation citizen.
To protect local ecosystems, mine waste (tailings) and mine closure must be closely managed to ensure that stakeholders, communities surrounding mine sites, investors, and the public have confidence in how mining operations are being run.
TSM has a tailings management component that measures companies’ tailings management systems and emergency response plans. Companies in Finland, that started to incorporate TSM in their operations in 2015, have since added mine closure protocols to build on what TSM has already established.
Regional collaboration for the future of ESG
Ensuring ESG provides long-term benefits to mining regions will require regional governments to work closely with standards bodies to carefully monitor companies’ activities, including and beyond the process of mine closure.
This continued evolution and global reach of mining and ESG, underscore the continued importance of ESG standards in shaping well-being in mining regions. Increased collaboration will ensure that mining projects not only meet critical mineral demands to tackle climate change but do so in a way that respects Indigenous rights, mitigates adverse environmental impacts, and generates meaningful benefits for local communities.
This year’s OECD Conference of Mining Regions and Cities will have a key focus on how ESG partnerships can boost well-being in mining regions. The event will take place October 8-11 (2024) in Greater Sudbury, Ontario, Canada.
Tara works with MAC members in addressing and understanding the federal regulatory and legislative environment that Canadian mining companies adhere to. In her role, shemonitorsemerging regulatory issues andparticipatesin policy development for a wide range of federal acts and regulations including the Impact Assessment Act, Migratory Birds Convention Act, Species at RiskActand the United Nations Declaration on the Rights of Indigenous Peoples Act. She is dedicated to working on species at risk and protected areas related issues and is an active member of the Nature Advisory Committee, a co-chair of the Canadian Environmental Domestic Advisory Group on the Canada-EU Comprehensive Economic and Trade Agreement (CETA) and a member of the Centre for Land Conservation’s Board of Directors.