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If miners want neighbours, they have to be neighbours

Being a good corporate neighbour means to have friendly, helpful, relationships between employees and their hosts to put a human face on the industry. Surely that is an asset that mining, the world’s least trusted industry cannot afford to ignore?

Source: https://www.fcx.com

However, the industry’s willingness to do more to focus on neighbourliness has yet to attract attention from investors, insurers, or industry analysts; it does not feature in ESG or triple bottom line accounting. Nevertheless, the impression is gained that most ordinary people, in most societies, are more likely to set more store on a mining company’s reputation for neighbourliness than they do on high-profile giving for worthy causes, or well-advertised corporate commitments to blue sky planetary improvement.

Neighbourliness has long been important for mining operations since operations are frequently located in the back of beyond, far from major cities, in regions where government health and education services are of recent provenance. Exploration geologists have long been aware of just how useful neighbourliness can be for their success.

Around the world, miners have earned a reputation for helping their neighbours by providing medicines and first aid, using earth moving equipment to help upgrade small tracks, or engineering improved water supplies; they have also done what they could to house, feed and help neighbours affected by natural disasters or extreme weather events.

Potable water for a community surrounding the Pueblo Viejo Mine in the Dominican Republic
Source: https://www.barrick.com

Neighbourliness has lubricated relationships helping to secure tenure and good labour relations; it has encouraged consent for expansion, generated new development opportunities, and earned favourable permitting, regulatory and taxation decisions. Without neighbourliness, companies have had pushback from communities, endured reputationally damaging civil society campaigns, and experienced frustratingly lengthy permitting delays, and costly labour disputes.

Key employees have been reluctant to bring their families to site; it has been harder to attract and retain high-quality personnel. Host- employee exchanges were welcomed when the miners understood, and observed, local rules for behaviour. This spontaneous sociability has covered a broad spectrum of interactions: managers, service providers, medical personnel, equipment operators and their families, and together with local landowners have attended cultural festivals and church services; company wives have cooked food for sale to help a local charity distributing prosthetic limbs and wheelchairs to the disabled.

Weekends have seen employees and their hosts hunting, fishing, playing football, or going out in small boats together. Participation has also involved long distance running, amateur dramatics, singing in choirs and listening to music, painting landscapes, gardening, collecting butterflies, or watching birds.

Ivanplats Platreef Community
Source: https://www.miningreview.com

Security personnel have taught small children how to behave when there is heavy traffic on the roads; a company nurse has used her spare time to visit neighbourhood health facilities and spend time with those who needed her help; a government teacher has gone out of his way to help the child of an employee; an engineer has offered career advice; another has fixed a communal water pump, an accountant has volunteered to provide coaching for a basketball or hockey team. These spontaneous exchanges have not only provided practical information for the design of community development initiatives, they have also, on occasion, shown that the miners did indeed have a social licence to operate.  If the importance of neighbourliness is to be recognised and encouraged the mining industry will have to do this job itself.

What is not to like about an activity that has employees working for the company all the hours that are available? What about GRI, Global Compact, ISO2600, and UNEP? Without visiting, and developing very new skill sets, there would be little point in having these organizations include neighbourliness in their League Tables. Nor would it make much sense to ask big UN aid agencies who also do not have neighbours for advice; global organizations cannot ‘see’ mining’s neighbours. What does seem important is the fact that the balance between global commitments with local obligations has been disturbed by too great an industry emphasis on the pursuit of global commitments at the expense of sites’ ability to respect the different neighbourhood traditions encountered in the Americas, Africa, and Asia.

Source: https://www.ifc.org

With the obvious exception of behaviour infringing fundamental human rights, neighbourliness has depended on miners recognizing and accepting, and working with and around, the different cultural, economic, and social beliefs, values, and attitudes of their hosts as well as their right to choose both their own direction of travel and the speed at which they wished to proceed. Within a single country different sites could have quite different rules and traditions for who got what and why.

Companies are relying on the art of the deal. Deal done, the company then reduces community functions and spending to care and maintenance levels. Business in the community also needs sentiment because miners need to show they care about their neighbours and their welfare.Relying on commercial transactions – one-sided, standardized, routinised, rule-bound, lawyered arrangements and agreements – sends the wrong message because these transactions have been designed to maximise company advantage rather than to give equal priority to neighbourhood aspirations.

These same companies then assess their own social performance and when their glossy corporate reports suggest that employees are performing socially it usually turns out that these claims are not the outcome of consultation with neighbours but are the result of a comfortable process of company self-assessment. In fact, only Indigenous Peoples are now consulted when it comes to how company personnel behave in their territory, and they alone have their judgments count.

As Senior advisor Rio Tinto 1995-2015, Glynn was responsible for initiating the design of policy and implementation for that company’s Community Relations at greenfield and brownfield sites in over 60 countries. Before Rio Tinto Glynn was a World Bank staff member and advisor to governments and their leaders on public sector reform.

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Rio Tinto sees new partnerships as the future of innovation

Rio Tinto is announcing that innovation opportunities increase significantly when new partnerships are forged towards common goals. The comments were offered by CEO Jean-Sebastian Jacques, of the mining giant during a recent conference in Melbourne.

Mr. Jacque’s comments identify that the value chain from customers upstream through “governments, society and communities…customers, suppliers and competitors is the way forward to innovation.”   Mr. Jacques also announced a partnership with Apple Inc. and Alcoa Corp. to produce greenhouse gas emissions-free aluminum. The announcement May 10, recognizes the most significant innovation in the aluminum industry in more than 100 years , the company offered.

What is not noted in this speech is the alignment with the 2016 ratified UN Global Compact of 17 Sustainable Development Goals 2030 that is driving the planet towards exactly this concept of working in collaboration using innovation to create solutions.

See the news release herehttp://www.mining.com/web/rio-tinto-sees-new-style-partnerships-future

See the UN initiative herehttps://sustainabledevelopment.un.org/?menu=1300

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Oyu Tolgoi announces Q3’18 Sustainability Metrics

Ulaanbaatar, Mongolia – Oyu Tolgoi today announced third quarter 2018 sustainability metrics

Oyu Tolgoi’s workforce reached 17,000 making it the largest private employer in Mongolia. 93 per cent of Oyu Tolgoi’s employees were Mongolian, 19.4 percent of which were from the local province of Umnugovi.

As of the end of the third quarter of 2018, Oyu Tolgoi achieved an All Injury Frequency Rate (AIFR) of 0.19 per 200,000 hours worked and was injury-free for 83 out of 92 days for the three months ended

Oyu Tolgoi maintained a world-class environmental performance in the quarter, with 0.35 cubic metres of water per tonne of ore processed – three times less, compared to similar operations worldwide – and achieving an average water recycling rate of 89 per cent over the period.

Oyu Tolgoi provided 215,503 man hours of training to nearly 10,301 employees and contractors and collaborated with 793 suppliers 562 of which are national businesses that account for 79 per cent of total operations procurement spent.

Oyu Tolgoi: http://ot.mn/our-commitments/

CSR Hub performance metric: CSR-ESG Ranking 27% compared with 556 mining companies globally


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How will the World’s First Electric Mine change the way that society perceives mining?

Canada injects $5M into Bordon Mine as prize for innovation

 Goldcorp’s Bordon mine https://www.goldcorp.com/English/portfolio/development-projects/borden/default.aspx is being recognized by the Canadian government as a disruptive innovation identifying the development as game changing. The development taps Canada’s Clean Growth Program (CGP), a $155M investment fund for clean technology research, development and demonstration.

The Bordon project has a strong element of Canadian manufacturing with MacLean Engineering https://www.macleanengineering.com/ of Collingwood providing a fleet of secondary mobile equipment, all electric.

It’s difficult it imagine an underground mine with significantly lower noise levels and no diesel fumes in the air.

The development is one of the best examples of disruptive change in the industry and pushes further on Canada’s theme of mining sustainability.

Read the story here, and comment on how this will impact Canada’s position in mining, manufacturing and your community


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Goldcorp, Teck and Barrick show Global Sustainability Leadership

In January 2016, the United Nations ratified 17 Sustainable Development Goals (SDG’s) to a 2030 agenda target, https://sustainabledevelopment.un.org/?menu=1300, and the UN Global Compact Ten Principles to ”first do business responsibly and then pursue opportunities to solve societal challenges through business and collaboration”. https://www.unglobalcompact.org/what-is-gc/mission/principles.

Get to learn what this is all about as it will drive mining corporate programs and culture. Mining companies are being driven by their metal buyers to develop verifiable programs. Supply and service companies are also being drawn into the life cycle equation with procurement request for sustainability standards. The UN initiative is serious and there is both action and motivation on all fronts of society including the mining industry to take notice and also take verifiable action.

The Mining Association of Canada (MAC) has developed a world leading initiative called Towards Sustainable Mining, (TSM) http://mining.ca/towards-sustainable-mining that sets auditable standards for their member companies. The TSM initiative has been accepted by five additional countries mining associations. Global Affairs Canada is lo an industry leader in driving sustainable and socially responsible business practise.

There are however a large number of other stakeholders that make up  the equation including suppliers, exploration companies, contractors, EPCM’s and others that are either unaware of these developments or lack training and programs to complete the life cycle of mining sustainability. The driving forces for a sustainable planet are working upstream from the consumer to manufacturers and service providers and are presently catching mining companies soon with a Tsunami force.

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Is Gender Equality a Holy Grail solution to Mining’s Integration into Mainstream Social Acceptance?

Women make up about 13% of the Canadian mining industry and mining rank near the bottom of industries when considering leadership roles. Yet studies show that there are huge benefits in having women in senior leadership positions.

According to a PwC report there is “a striking correlation between return on assets and the number of women on a board.” A McKinsey & Company report suggests that “women tend to have a knack for team building; they are particularly good at defining responsibilities clearly, and mentoring and coaching employees. Mervyn Davies, an International Banker suggests that in terms of business results, the more diverse the thinking on a team, the better the results. A UN report has made postures to the potential of gender equality in mining to be able to drive the industry to higher profitability.

The 11th international Gender Summit held in Montreal from November 6-8 aimed to enable multi-stakeholder dialogue on gender issues in science, industry and government. The conference noted that the mining industry has one of the most severe gender gaps. The report also found that profit margins are higher for mining companies with women on their boards.

A notable area of deficient progress is senior levels of management where the number of women lags behind other TSX listed companies as reported in CIM Magazines coverage of a new Osler, Hoskin and Harcourt LLP report http://magazine.cim.org/en/news/2017/tsx-companies-lag-board-diversity/. The report also identifies a root problem that the pool of available resources is small.

Are women gaining a more important role in mining, and what is holding back a more noticeable evolution to gender equality? The strategy -includes increasing the number of women entering the science and engineering fields however that’s too late. The solution starts at an earlier time, when children are developing interests and skills. There is a time honored perception that girls and boys channel into traditional roles. Girls should be encouraged to look at science and specifically mining a rewarding career. Today’s evolving and unalterable shift to sustainability and social responsibility themes offers a significant opening for women to choose mining as a career .

The mining industry needs to encouraging primary and secondary school aged children, of all genders, to avoid the perception that there are gender-specific roles. Mining Matters, https://miningmatters.ca/  is doing exactly this. It’s “a charitable organization dedicated to bringing knowledge and awareness about Canada’s geology and mineral resources to students, educators and the public.” The organization and its mandate have had an important part to play in Canada’s present and future role a world leader in sustainability and social responsibility solutions.

The Ostler report also indicated that women were driven at least as passionately as men towards challenging careers however their selection had to align with their “personal values”. As mining develops its messaging and programs towards mining sustainability and social responsibility themes, there is a positive expectation that women will pick up this messaging earlier in their career plans.

There is a significant opening for women to take charge of the future position of mining in society by developing culture, communication, collaboration and governance practise. The Canadian mining industry has an opportunity to develop a generation of gender equal, mining professionals with sustainability and social responsibility as the message to industry. Shared values such as gender equality have the potential to drive solutions to some of mining’s major corporate issues.

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DeBeers and Alrosa Supply Chain’s to test Blockchain to Follow the Journey of a Diamond

Alrosa, the world’s largest diamond miner has joined with DeBeers to map the journey of a diamond from the mine to the ring finger. The purpose of the partnership is to improve supply chain performance in tracking the authenticity of mined diamonds and eliminate fraudulent players.

Tracer is a new software solution developed by DeBeers and launched in January 2018 with a selected group of industry participants; https://www.tracr.com/ The website states that Tracer is “setting the standard for diamond traceability” providing consumer assurance, transparency, openness, collaboration, trade confidence, security and privacy driving as the driving narrative.

DeBeers uses a collaborative mining industry focused digital platform that follows the diamond asset across the complete value chain; rock face to the adoring recipient. The miner is working with the complete supply chain including other diamond producers, banks, trading houses, product graders, governments, logistics and retailers.

“The collective efforts of the world’s two leading diamond producers will enable more of the world’s diamonds to be tracked on their journey from mine to retail,” De Beers’ chief executive Bruce Cleaver said in the statement.

“Traceability is the key to further development of our market,” Alrosa’s chief executive Sergey Ivanov said. “It helps to ensure consumer confidence and fill information gaps, enabling people to enjoy the product without any doubts about ethical issues or undisclosed synthetics.”

Blockchain is the combination of several different existing technologies combine into three component technologies; a private key cryptography, a distributed network with shared ledger, and a means of accounting for the transactions and records.

DeBeers’ use of Blockchain to development a secure supply chain solution for the diamond industry is a notable example of the global mining industry making disruptive change utilizing digital solutions from other industries.

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The Canadian Mining Industry is Leading All Industries in Sustainability Reporting

If there was ever a story that deserves repeating and amplifying in mining, it’s that the Canadian mining industry is taking seriously the issue of sustainability and social responsibility. Bad news travels very fast as experienced in the new world of social media, however good news such as this is difficult to spread broadly enough. Given that the last good news Hollywood movie was in 1937, Snow white and the Seven Dwarfs, it is perhaps it may be time for a second take.

The Center for Sustainability and Excellence, https://cse-net.org/all-trainings/  is a leader in -Sustainability training and are reporting on a study just released; 2017 Sustainability Reporting Trends in North America. In the comprehensive survey of 1,500 companies the report identifies Mining as the leading Canadian industry with 27% publishing sustainability reports followed at a distance by Energy Utilities at 19% and Financial services at 16%.

Outcomes of sustainability reporting include influencing stakeholder perception and a proven positive impact on financial reporting. Of important note, the three largest Canadian gold mining companies have some of the top programs in sustainability, Goldcorp, Teck and Barrick.

There are two leading Canadian influencers to this disruptive style change to the industry with each developing a global approach to their programs.  The Mining Association of Canada (MAC) has developed their Towards Sustainable Mining initiative (TSM), http://mining.ca/towards-sustainable-mining, an initiative started in 2010 for their member companies and now adopted by the mining associations of five other countries.

Also, Global Affairs Canada is a powerful advocate for mining CSR leading with training, advocacy and oversight through their program called Responsible Business Abroad; http://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/other-autre/csr-rse.aspx?lang=eng and supported by the Canadian Trade Commissioner Service  posts around the world.

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Can Blockchain Arrest Supply Chain Financial Crime?

The capability to apply advanced analytics, offers blockchain an opportunity to offer supply chain managers a digital weapon to arrest and prevent financial supply chain crime. A recent Deloitte poll identifies that during the past five years, an average of 31% of respondents identified supply chain financial crime, particularly fraud, during the past year. Of these positive respondents, only 15% are presently using or piloting Blockchain solutions to mitigate the problem.

“Financial crimes in supply chains are more complex than ever, but some leading edge organizations are leveraging emerging technologies to help combat it,” said Larry Kivett, a Deloitte Risk and Financial Advisory partner in the forensic practice, Deloitte Financial Advisory Services LLP.

Enhanced transactional transparency and visibility along the chain of custody is driving corporate strategies to both detect fraud and also to clean up waste and other abuses with significant potential to add to the financial bottom line. The implementation of Blockchain is taking place with third-party relationship management and transaction execution solutions. .

The mining industry reports higher than average rates of supply chain abuse along with energy and industrial. They are also among those with below average use and trial of Blockchain. Data encryption and information security lead as the most significant anti-fraud tools of Blockchain that could apply to offer the path to correction.

“We’re seeing a growing awareness among executives that blockchain could be worth exploring as it can offer a new way to mitigate the possibility of supply chain fraud, waste and abuse,” Mike Prokop, a Deloitte Risk and Financial Advisory managing director in regulatory and operational risk management, Deloitte & Touche LLP.

“While the technology’s application for financial crime management in supply chains is nascent, early adopters could glean interesting competitive advantage by leveraging blockchain’s inherent anti-fraud functionality.”

Including data encryption and information security, creating an immutable register was the second most identified value. Blockchain brings trust to peer to peer networks and has gained its recent popularity due to its role as the underlying technology of Bitcoin.

Reference: Material Handling & Logistics ,  https://www.mhlnews.com/global-supply-chain