ESG matters gain importance with investors

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How do you manage your environmental, social and governance (ESG) risks? This is a question mining companies can expect to hear more often, especially from investors. The answer lies in taking an integrated approach to risk management, one that is fair, efficient and transparent.

At the Mines and Money conference held in London from 25 to 27 November, ESG certainly took centre stage, as it has been in most conferences that bring investors and mining companies together. Tom Butler, CEO at ICMM said “investors are paying much more attention to ESG.” He stated that shareholders no longer have primacy and are put on an equal footing with communities, workers, customers, and suppliers.

The conference boasts attendance from 2 000+ executives, 600 investors, 100 sponsors and exhibitors and 150 mining companies. IsoMetrix was proud to sponsor the conference; as world-leaders in Environmental and Social Sustainability software for the mining industry, we have our fingers on the pulse of the growth of ESG as a material risk.

Tal Lomnitzer, Natural Resources succinctly stated at the conference that, “historically, there was a lack of ESG data. From my perspective ESG is our new licence to operate.”

Cecilia Jofre, Chief Sales Officer at IsoMetrix joined a panel discussion at the event moderated by Sarah Gordon from Satarla to debate "Is the mining industry doing enough to implement ESG at the ground level.” Cecilia stressed that ESG must be driven from the top with a clear vision.

Benoit Froment, Business and Partner Director at IsoMetrix said that the best part of the conference was the Mining Pitch Battles. In these battles, mining companies got the opportunity to promote their project and answer questions from a jury with the aim of securing investment for their projects. The jury grilled the mining companies on matters such as: permitting, tailings management, artisanal mining and surrounding communities support. “These pitch battles made it clear that proper environmental and social management is a high priority for investors.” Benoit also pointed out that IsoMetrix is well positioned globally and at the forefront of ESG management software. “US$2.3 billion was spent on mining exploration in Latin America last year. There are over 300 companies listed on the TSX/V with Latin American mining projects. IsoMetrix is active in six countries in Latin America,” he said.

Debbie Elrick, Business Development Executive from IsoMetrix, also attended Mines and Money and observed that, “The percentage of investors applying ESG criteria in Europe is undoubtedly higher, although the rest of the world is catching up.” No longer is it just about profitability, with some European governments even considering mandating that pension funds should formally assess ESG aspects for all their investments.

“This directly impacts investment funding in the mining industry which has long been tainted with negative narrative around the social and environmental impact of their operations,” she said. “IsoMetrix has gained recognition as a global leader in the provision of software to the extractives industry for managing material risks and we are fast entrenching our status as a leader in the EHS space.”

Globally, the number of signatories to the UN-backed Principles for Responsible Investment (PRI) has increased more than tenfold over the last 12 years, to almost USD90 trillion under management as of their last annual report.

Given that mining activities have formed the backbone of our industrialized society for centuries, ESG factors are driving the shift from condemnation to improvement; as LSE listed mining organisations continue their journey to conscious and responsible mining.

To find out more about how IsoMetrix can help you manage ESG, contact us