Sustainability through accountability

When it comes to accountability for mining impacts, community is key, explains Noora Puro.

Across the mining sector, a delicate balancing act has been playing out: although minerals are intrinsic to global development and can pave the way for a low-carbon economy, the impacts of their extraction are disproportionately felt by communities living in the vicinity of operations.

Critical incidents at mine-sites and disputes with local stakeholders are examples of issues that can compromise an organisation’s social license to operate. The term, which denotes the acceptance of organisations and their operations by local communities, is essential to sustainable mining – but takes time and effort to cultivate. After all, building trust is not just about making a promise, it is about following through.

Ensuring that mineral wealth brings real and long-term gains to communities is a multi-faceted challenge that requires persistence and excellence across all dimensions of sustainability, including transparency about the impacts mining operations have on the groups affected by mineral extraction. The proposed GRI Sector Standard for Mining invites stakeholders  to provide input on this critical issue – alongside wider environmental and economic topics – to develop a holistic sustainability reporting standard that will improve accountability on the sector’s impacts.

The range of stakeholders who can potentially be affected by mining includes not only residents near or downstream from mining operations, but also the farmers, artisanal miners, employees, contractors or migrants, who live and work in the wider vicinity. The rights of Indigenous Peoples are of particular concern, especially given the prevalence of mining that occurs on protected land, and the history of conflict between mining firms and such communities. In many cases, these groups can gain financial benefits from mining activities, but also bear the brunt of its negative impacts.

Achieving a balance of impacts and opportunities

“Mining can provide employment, opportunities for local suppliers, taxes, community development, infrastructure and investment,” Judy Kuszewski, the outgoing chair of GRI’s Global Sustainability Standards Board, recently stated. “And yet, at the same time, mining activities can have an adverse effect on communities and their livelihoods through biodiversity loss, pollution, lack of access to freshwater, noise, displacement and health and safety threats.”

Yet if relations with local communities are managed with an eye towards transparency and shared benefits – with vigilance to avoid, mitigate and remediate negative impacts – mining operations can be a source of positive change. They can bring a much-needed inflow of capital and employment, providing prosperity and decent work. They can also support community development and infrastructure investments with lasting benefits, such as renewable energy, transportation networks or water infrastructure. Proactive and continuous consultation with local stakeholders throughout the mine life can also prepare communities for a diverse and resilient post-mining economy, helping mitigate the sometimes drastic impacts mine closure can have.

“Through the development of the GRI Standard, this juxtaposition has really been front and centre,” explained Kuszewski. “Having that kind of balance in mind the whole time is a foundational principle to the work that’s been done here.”

Deeper engagement with impacted communities

In the process of drafting the Mining Standard, the importance of meaningful community engagement by mining organisations has been consistently raised by the expert working group and peer reviewers. Disclosing information in local languages is seen as essential, taking into consideration vulnerabilities and sufficient representation of the effected communities themselves. Being transparent about environmental and social monitoring on mine site-level impacts can signal an openness by organisations about their actual impact and their management on local communities.

Due to the salience of communities in this sector, GRI has organised consultation sessions aimed at community and civil society groups specifically. These engagements in Africa and Latin America made it abundantly clear: community is key. Stakeholders in the sector expect transparency from start to finish, and they increasingly demand information that the community can understand and engage with.

Stakeholder input received so far through in-person sessions during GRI’s public comment period has highlighted that the dialogue must occur on an equal footing. Providing capacity-building for local groups on participation, ensuring consultations are democratic and inclusive, with transparency about who was consulted and at what stage, are ways mining companies can mitigate corruption risks while helping communities regain trust.

Equity in value creation

nlike reporting that focuses only on financially material issues, the GRI Sector Standard for Mining will consider a wider range of concerns directly related to the challenges faced by communities. This includes whether they are consulted on post-mining land use, approaches to employment, procurement and training opportunities, as well as the framework for providing remediation to individuals subjected to involuntary resettlement. The draft Standard also gives attention to the programs to enhance positive impacts or mitigate negative impacts involving artisanal and small-scale mining (ASM).

Rather than looking at risks that communities or vulnerable groups might pose to the mining company as a potential trigger for conflict or operational delays, the proposed Standard focuses on to how organisations are creating value for the people whose lands they are using to extract resources from.

The mining sector is increasingly under a magnifying glass due to its essential role in enabling a low-carbon transition – to ensure that impacts of extracting minerals are well managed and benefits equitably distributed. Sustainable mining can be a boon for everyone: resource-rich economies can achieve long-term stability, while mining companies can develop positive relations and a social license to operate – with communities reaping benefits from their land and labour.

To that end, the GRI Mining Standard will be a crucial step toward accountability for a sector deeply involved both in the significant sustainability challenges facing the global society, as well as the potential solutions to overcome them.

Noora Puro is sector standards manager, Global Reporting Initiative (GRI).