{"id":1141666,"date":"2019-10-02T11:13:36","date_gmt":"2019-10-02T16:13:36","guid":{"rendered":"https:\/\/www.mining.com\/?p=1003428"},"modified":"2019-10-02T11:13:36","modified_gmt":"2019-10-02T16:13:36","slug":"stakeholder-pressure-ethical-investing-make-losing-licence-to-operate-biggest-threat-to-miners","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1141666","title":{"rendered":"Stakeholder pressure, ethical investing make losing licence to operate biggest threat to miners"},"content":{"rendered":"<p>Mining executives across the globe believe<br \/>\ntheir efforts towards effectively reducing the sector emissions and those of<br \/>\ntheir clients will be key to keeping their licence to operate, as governments become<br \/>\nmore involved in curbing risks associated to climate change.<\/p>\n<div class='d-flex justify-content-center'>\n<div id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {googletag.display('div-gpt-ad-1561499308230-0');});<\/script><\/div>\n<\/div>\n<p>Losing social support, or social licence to operate (SOL), is in fact seen as the main risk mining and metals firms are facing these days, an <a href=\"https:\/\/www.ey.com\/ca\/en\/newsroom\/news-releases\/2019-license-to-operate-continues-to-dominate-the-top-risks-list-for-miners\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">annual study published by consultancy Ernst &amp; Young<\/a> (EY) shows.<\/p>\n<p>This is <a href=\"https:\/\/www.mining.com\/losing-licence-operate-new-biggest-threat-miners-ey\/\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">the second year straight<\/a> that nearly half (44%) of global mining and metals executives rank the topic as the No. 1 threat to their business, showing an important shift in the industry from profit to social responsibility. <\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p>This is the second year in a row that global mining and metals executives say that no longer having a social licence is the No. 1 threat to their business.<\/p>\n<\/blockquote>\n<\/figure>\n<p>\u201cIncreased stakeholder pressure and the rise of ethical (environmental, social and governance \u2014 ESG) investing continues to keep license to operate top of mind for the sector in&nbsp;Canada&nbsp;and abroad,&#8221; Jeff Swinoga, EY Canada Mining &amp; Metals Co-Leader, says. <\/p>\n<p>The mining and metals sector is<br \/>\nfacing greater scrutiny from end consumers, demanding a transparent ethical<br \/>\nsupply chain, as well as a lower carbon footprint. <\/p>\n<p>Shareholder activists are driving<br \/>\nmany miners, particularly those with coal assets, to reshape their portfolios<br \/>\nby either reconfiguring existing operations or executing divestments.<\/p>\n<p>&#8220;Companies must show how<br \/>\nthey&#8217;re working towards sustainable and inclusive growth to redefine the<br \/>\nsector&#8217;s image as a responsible source of the world&#8217;s minerals. Demonstrating<br \/>\nthese values is also key to addressing growing workforce challenges,&#8221;&nbsp;Swinoga<br \/>\nnotes.<\/p>\n<p>EY recommends mining bosses to<br \/>\nstart focusing on their \u201cscope 3\u201d emissions \u2013 those made by its customers.<\/p>\n<p>&#8216;If mining and metals companies are going to understand their exposure to climate-related risk and capitalize on the opportunities of the transition to a lower carbon economy, then it is inevitable that they will need to properly account for their scope 3 emissions,&#8221; the report says.<\/p>\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Top-10-business-risks-facing-mining-and-metals-companies-ey.jpg\" alt=\"\" class=\"wp-image-1003435\" srcset=\"https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Top-10-business-risks-facing-mining-and-metals-companies-ey.jpg 827w, https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Top-10-business-risks-facing-mining-and-metals-companies-ey-300x201.jpg 300w, https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Top-10-business-risks-facing-mining-and-metals-companies-ey-768x514.jpg 768w\" sizes=\"(max-width: 827px) 100vw, 827px\" \/><\/figure>\n<p>&#8220;Mining and metals companies will have to assess the markets they sell to and consider the impact of selling to customers who produce substantial emissions in the use of their products,&#8221; it adds.<\/p>\n<p>Among the other risks mentioned by<br \/>\nthe mining executives interviewed, \u201cfuture of workforce\u201d rose from 7th to 2nd<br \/>\nplace in the ranking due to increasing demand for and difficulty attracting the<br \/>\ndigital and data-related skills needed to support the future of mining.<\/p>\n<p>&#8220;Digital and data<br \/>\noptimization&#8221; fell one place but held its position in the top three<br \/>\nbusiness risks cited by miners as they grapple with how to unlock the most<br \/>\nvalue from investments.<\/p>\n<h2><strong>Beyond the \u201cGreta effect\u201d<\/strong><\/h2>\n<p>EY&#8217;s survey comes barely a week after&nbsp;the world\u2019s second largest miner, Rio Tinto, <a href=\"https:\/\/www.mining.com\/rio-tinto-strikes-deal-with-chinese-customers-to-cut-steel-making-emissions\/\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">signed a pact&nbsp;with China&#8217;s biggest steelmaker Baowu<\/a> to develop and implement ways to reduce carbon emissions in the steel sector, which is responsible for about 9% of global carbon dioxide (CO2) emissions.<\/p>\n<p>It also comes on the heels of environmental activist\u00a0Greta Thunberg\u2019s searing address at the United Nations\u00a0last week, in which the 16-year-old chided world leaders for not doing enough to address climate change.<\/p>\n<div class=\"wp-block-image\">\n<figure class=\"alignright\"><img decoding=\"async\" src=\"https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Greta_Thunberg.jpg\" alt=\"Stakeholder pressure, ethical investing keep licence to operate as biggest threat to miners\" class=\"wp-image-1003438\" srcset=\"https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Greta_Thunberg.jpg 492w, https:\/\/www.mining.com\/wp-content\/uploads\/2019\/10\/Greta_Thunberg-300x274.jpg 300w\" sizes=\"(max-width: 492px) 100vw, 492px\" \/><figcaption>Greta Thunberg (16) grabbed the attention of the world at the Climate Action Summit after accusing world leaders of stealing her dreams due to their lack of action around climate change. (<em>Image: <a href=\"https:\/\/commons.wikimedia.org\/wiki\/File:Greta_Thunberg_7.jpg\"  rel=\"noopener noreferrer\">Anders Hellberg | Wikimedia Commons.<\/a><\/em>)<\/p>\n<\/figcaption><\/figure>\n<\/div>\n<p>Thunberg emphasized the urgency of<br \/>\nthe global situation, referring often to figures from a seminal report released<br \/>\nby the Intergovernmental Panel on Climate Change in October 2018 on the&nbsp;<a href=\"https:\/\/www.ipcc.ch\/sr15\/\"  rel=\"noreferrer noopener\">impact of 1.5 degrees Celsius<br \/>\nof global warming<\/a>.<\/p>\n<p>The document stated that the planet<br \/>\nhas already warmed by 1 degree Celsius since the 19th century, and used 1.5<br \/>\ndegrees as a threshold beyond which the effects of climate change, such as<br \/>\nmelting ice, extreme heat and sea-level rise, become life-threatening for tens<br \/>\nof millions of people around the world.<\/p>\n<p>Reducing global CO2 emissions by half in ten years, as the almost 200 nations that <a href=\"https:\/\/ec.europa.eu\/clima\/policies\/international\/negotiations\/paris_en\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">signed the Paris Accord in 2015<\/a> agreed, may not be enough.<\/p>\n<p>\u201cMathematically and technically, it is possible, but it\u2019s not realistic,\u201d Simon Donner, a climatologist at the University of British Columbia in Vancouver, Canada, <a rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\" href=\"https:\/\/policyoptions.irpp.org\/magazines\/october-2019\/no-partys-climate-plan-will-avoid-dangerous-global-warming-levels\/\" >said in a piece published Tuesday<\/a> in <em>Policy Opinions<\/em> magazine. \u201cTo reduce emissions that sharply in what is now only a 10-year period would take enormous changes in countries around the world.\u201d <\/p>\n","protected":false},"excerpt":{"rendered":"<p>This is the second year in a row that nearly half of global mining and metals executives rank the topic as the No. 1 threat to their 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