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Consumerism & the mining industry: part 2

In the second of two consecutive articles, Carly Leonida and Elizabeth Freele discuss how to bridge the gap between mining companies and consumers, and build trust and appeal in this vital sector

In the first part of this article series, Sympact Advisory’s co-founder and managing partner, Elizabeth Freele, joined me to discuss the rise of conscious consumerism and societal distrust, and the ways in which they are impacting the mining sector.

Our thoughts and musings were simply too numerous to fit into a single article and so we continue the conversation here.

To summarise: there is currently a significant lack of trust surrounding the mining industry and we need to act now to improve this or risk irrelevancy.

Time to take action

What could we do to open up channels of communication and build trust in a sustainable way? I asked Freele.

“One thing that we often still miss as an industry, is that we think public relations, branding, marketing or advertising are a solution,” she said. “They’re not. That traditional industry is dying.

“If we look at the way marketing and advertising are evolving globally, and the way that the general public interacts with marketing materials, it’s obvious the traditional ways aren’t working anymore.

Elizabeth Freele stands smiling in front of a snowy open-pit mine. She is dressed in full PPE
Elizabeth Freele is co-founder and managing partner at Sympact Advisory. Image: Elizabeth Freele

“And yet we’re still attached them i.e., we continue to focus on packaging up the positive things about our business in the shiniest, prettiest, sexiest way for the public, while avoiding the rest.

“The public doesn’t buy into that anymore, because they also read the news and they’re on YouTube, Twitter

“They know that for every shiny story, there’s also ugliness associated with environmental social governance (ESG) in mining, and so it doesn’t feel sincere.

“There’s this gap that they see between our pretty sustainability reports and the narrative that companies don’t control. The challenge in our communication efforts is to bridge that gap.

“We need honesty and authenticity. We need to own the mistakes that we make, express the challenges we have. Asking for help and inviting diverse others into the discussion is something we need to do more of.”

Share more positive stories

Education is a vital component of this. The vast majority of people still don’t know how much mining serves their everyday lives.

We missed a huge narrative as an industry around COVID vaccines, for example. There are a myriad of minerals and metals used inside the vaccines themselves, and also in needles and medical equipment. Those provide a chance for the mining industry to engage with society in a broader way than usual.

“Where are the public-facing communication campaigns from our industry associations?” asked Freele.

“Even at the individual company level, a lot of miners stepped up [during the pandemic] and did wonderful things to support host communities and regional governments. It feels like we missed an opportunity there to share our unified story.”

Freele added that, in their educational and communication efforts, companies need to focus on the good that they do.

But critically, first and foremost, they need to make sure that the ‘good’ that they do is actually good. That it’s not just surface-level, old-school corporate philanthropy done with the intention of creating a PR story that the public will hopefully buy into. Because they likely won’t.

“Companies sometimes like to put their name on things and make stories more grandiose than they are when it comes to social impact,” she said. “That’s dangerous, as it can cost them considerable credibility and even breed resentment.

“So firstly, doing a lot more sustainable social good in partnership with stakeholders is really key to meeting evolving societal expectations of business. It is then, secondly, that you will have great content to capitalise on for corporate communication efforts.”

Focusing purely on social purpose branding and communication efforts to gain the public’s approval tends to fail if there isn’t substance behind them. That is a universal challenge business is facing right now. And as usual, mining is one of the slower industries to realise it.

Coloured diagram explaining how a shift in 'lens' is required to build trust in the mining industry
The mining industry needs to change the way it views itself in order to truly build trust between itself and society. Image: Sympact Advisory

Leave the ‘us and them’ attitude behind

There is also a change in mindset required around the way in which mining companies, and the mining industry in general, view themselves. This is particularly evident in the language used.

(Note: I am acutely aware that I use the terms ‘us’ and ‘we’ a lot when referring to the mining industry. Know that it’s something I’m working on).

Freele believes that moving from a business-centric lens towards a systems-centric lens will be paramount to fostering trust in the future.

“We’re used to an ‘us and them’ perspective, and this attitude can unwittingly bring on a lack of trust,” she explained.

“The necessary move is learning to see yourself, as a company with a mine site, as one entity within a broader social ecosystem, where there are many actors, with many different interests. You need to put the effort in to get to know those other actors, and let them get to know you.

“Learning to behave as one entity within that shared ecosystem means seeing your business within the broader lens of humanity, and humanity within planetary boundaries.”

There’s also a view that stakeholder value is not quite enough. Freele commended the industry on moving beyond mere shareholder value, but emphasised that it’s happening in a world on fire.

“This mindset shift is critical to being a meaningful contributor to solving humanity’s grand challenges in the way the public increasingly expects of business,” she said.

“The kids in the Fridays for Future protests don’t care about industries creating stakeholder value. They care about having a planet that’s going to be decent to live on.

“All our business decisions need to be made through that lens going forward.”

Such a change in approach also comes with a positive impact on corporate social investment efforts, says Freele.

By moving from a philanthropic ‘doing for’, to a partner-based and collaborative ‘doing with’ approach, companies build more meaningful societal relationships, where trust is fostered.

This also creates more impactful and lasting outcomes, which companies can then tell powerful stories about.

Disrupt or be disrupted

What could be the consequences if we don’t talk about building trust, if we don’t do anything? I asked Freele.

“I think you already know,” she said. “It’s the lack of new talent, the loss of your investor base. But it’s also substitute products and business models. For example, where are the circular economy partnerships in mining that so many other industries are announcing every day lately?

“Part of the problem is that the world doesn’t trust this industry, and part of it’s our attachment to opaque and traditional ways of operating. Either way, it’s a problem if we’re not even in the room to be part of the conversation about a collective sustainable tomorrow.

“We’ve got to find our way into that room. Can we participate in circular value chains or the provision of alternative products? Do we need to be attached to our traditional product base and operating models?”

It’s a good point. If there are ways to be a profitable, valuable business to society that involves pulling less rock out of the ground, that’s not a bad thing.

If we get to the point of premium products i.e., where those produced under responsible, ethical standards command a higher price, then there’s a chance that companies who don’t respond could lose access to preferred markets.

Elizabeth Freele kneels next to a community stakeholder. Together they are planting a tree sapling
Doing more sustainable social ‘good’ in partnership with stakeholders is key to meeting evolving societal expectations of business. Image: Elizabeth Freele

The other scenario, which is probably more likely, is that if a company’s products don’t meet a certain standard, then that organisation may find itself unable to sell its product.

For example, with the new European Union regulations on conflict minerals sourcing that came out in January, there are assets under development right now that will find themselves unable to sell their product in the EU market if that regulation is properly implemented.

As an industry, we’re also opening ourselves up for disruption; if we’re not going to produce metals the way consumers and end users would like, then someone else sure as hell will…

“The possibility of new market entrants is definitely real. It’s already happening,” said Freele.

“I know Elon Musk likes to just be a shit disturber sometimes; is he going to do anything with the lithium concession he acquired in Nevada…? Maybe he will, maybe he won’t. Regardless, it’s a data point that suggests where we might be going.

“If miners, as we know them today, don’t keep up, others will find a way to do so.

“As one of my favourite MBA professors always used to say: ‘we have to disrupt ourselves or face being disrupted’.

“We live in exponential times and the world is changing fast, which requires business leaders to become more nimble and agile. No industry is untouchable in this new era.”

I already see signs of that at an operational level, I told Freele. There are companies now that are looking to bring in mobile plants, precision mining techniques and such like. But I don’t think we’ve figured out how to do agility at a corporate level yet.

“You’re right. Too often it’s incremental, siloed and ad hoc, and that means it’s not strategic,” she replied. “It’s not fast. It’s not industry wide. And therein lies the problem: as an industry we aren’t responding to the rapidly evolving societal expectations at the necessary rate to thrive.

“That’s huge. It’s existential for the mining industry.”

Embracing the inevitable

At the end of the day, the reason people don’t want to be a part of this sector, don’t want to be associated with it or invested in it, is because of what we currently are. Mining is, frankly, unattractive.

“It usually doesn’t feel honest or authentic. It doesn’t feel collaborative and it doesn’t feel like there is genuine care for the bigger picture; the system we all share in as human beings,” said Freele.

Diagram illustrating types of corporate social investment and the benefits to both mining companies and society. Image: Sympact Advisory
Diagram illustrating types of corporate social investment and their benefits to both mining companies and society. Image: Sympact Advisory

“It feels like one hand doesn’t know what the other’s doing… A mining company aces the ESG ratings one day, and the next a tailings dam collapses or a human rights scandal shows up in the press… Mining as a whole doesn’t feel trustworthy.”

But it could be, I said. Ever the optimist.

“Of course, it could be,” said Freele, with passion. “It must be. The world needs it to be! It’s tough though, because the world doesn’t even understand that they need it to be.

“It’s on us to help them understand and to get them to care.

“If we do that, then maybe we can get the innovative young minds of today and tomorrow to roll up their sleeves and get involved in our challenges to shape a brighter future.

“Whether that means an injection of new millennial capital, collaborations with other industries in the value chain, or fresh grads choosing mining over Big Tech.

“But it’s got to come from us first.

“It’s not an easy feat, but we can’t count on anyone outside of the industry to get us there.”

Enjoyed this article? Catch up on the first part of the discussion

1 comment on “Consumerism & the mining industry: part 2

  1. Pingback: The Trust Deficit – Consumerism and the Mining Industry – Artemis Project

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