WSP has been a signatory of the UN Global Compact since 2019, reporting on progress related to the UN Global Compact’s Ten Principles and advising clients around the world on their green transition. In Africa, the mining sector has been a key area of engagement for WSP – where mining organisations have the potential to make significant impacts in ESG due to the prevalence of mining activity across the continent.
As leading mining companies around the world disclose their intended path towards achieving net zero, as well as the challenges they expect to face and the expected costs associated, it is clear that ESG is topping the agenda. “WSP recently reviewed the public commitments made by 12 of the top mining companies internationally, and some promising trends emerged,” says Heath. “Decarbonisation is the foremost commitment made by miners. Even more encouraging is that addressing climate change, switching to renewable energy and incorporating sustainability into decision making are in the top five.”
If mines are to meet these commitments, they will need to expand their existing multi-disciplinary processes for identifying, assessing, and managing risks. “These risk management frameworks are already robust,” Heath explains, “but will need to evolve with the dynamic nature of climate change considerations both at corporate and operational levels.”
Regulators are increasingly requiring an understanding of climate change risks and opportunities – and the disclosure of climate-related risks in particular. In parallel, there is a growing expectation from investors, lenders, insurers, and communities of interest that companies demonstrate how climate-related risks are being managed.
“Purchasing or investing in new renewable power supplies, undertaking capital works programmes to upgrade the capacity of electrical distribution networks, electrification of diesel-powered equipment, addressing fugitive emission sources and applying water stewardship principles are some of the key ways we’re seeing mines acting on the “E” part of their ESG commitments,” says Singh. “But it cannot stop there, as the “S” and “G” are also gaining importance for stakeholders from investors to communities.”
“The direct impact of climate change in mining cannot be ignored. For instance, extreme precipitation resulting in flood damage to infrastructure - including mine waste residues - can have significant consequences and must be accounted for in the mine planning and ongoing operations. But more than that, indirect impacts such as the health and safety of personnel onsite or of people in the surrounding communities, legal liability, and reputational consequences, also contribute to the pressurised environment mining houses find themselves in,” says Heath adds.
WSP is focusing on several strategic areas for its mining clients, to support them in taking account of, and action towards, ESG holistically. These include water, waste, and energy efficiency and security, coupled with care for human resources and communities, and of course longer-term rehabilitation of the environment though customised mine closure strategies.
“Our ability to not only do the strategic thinking and planning around climate resilience and ESG but also design and implement real world solutions for our clients fundamentally differentiates us from our competitors,” says Heath. “For example, with our assistance, one of our multinational mining clients has taken a unique water stewardship and resilience approach. They have created opportunities and technology in water savings because they looked at the challenge holistically and then applied it locally. This is what true sustainability thinking is all about.”
Singh agrees that a holistic approach is key. “A clear understanding of both the health and safety, and compliance and ethics issues associated with a project, as well as the environmental and social commitments the mining company aims to demonstrate, are key to ensure alignment on ESG across the mining house’s operational footprint.”
“Assessing climate change risks necessarily, involves a multidisciplinary set of skills and a team that can integrate scientific understanding, such as interpretation of down-scaled global circulation model data and GHG emissions, with engineering knowledge of mine design and operations,” she continues. “With our wide range of specialists, we are able to quantify the financial impact of climate risks and opportunities for our clients. And then work with them to establish the optimum roadmap and implementation plan to achieve their sustainability and ESG objectives.”
“It is an exciting and challenging space to be working in and we are proud of the contribution we can make in supporting the green transition of the sector,” concludes Heath.
ESG principles remain a fundamental part of most mining companies’ values, with dedicated environmental and social professionals supporting delivery of these commitments. As investors and the public want to know more about what mining companies are doing to deliver on their commitments, it is encouraging to see miners continue to adapt and prioritise ESG.
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