SPONSORED BY THE DEVELOPMENT PARTNER INSTITUTE
Every person on this planet is, directly or indirectly, a beneficiary of mining and metals supply chains. By providing the raw minerals required to power homes and businesses, grow food and transport goods, mining companies and their partners are the driving force behind global socio-economic development.
But consumer pressure on these businesses is building, not only to ramp up supply – according to the International Energy Agency, mineral demand for clean energy technologies will likely quadruple by 2050 – but to do so in a way that’s purposeful, transparent and leaves a positive social and environmental legacy.
There are many different views of what constitutes ‘responsible mineral sourcing’, but until recently, there was no unifying vision around which meaningful actions could coalesce.
Florence Drummond is Executive Director of the Development Partner Institute (DPI), an international group of leaders from across the mining and metals ecosystem that is developing this through its Responsible Sourcing Coalition (RESCO).
She explained: “At a time when there’s so much social, environmental and economic change going on in the world, there’s no better moment for parties across the value chain to come together and define a vision for responsible sourcing as well as a map of the pathways leading to it.
“This will allow companies, consumers and stakeholders to deliver the materials needed for a low-carbon, sustainable future where everyone can prosper.”
What constitutes responsible sourcing?
Responsible sourcing is traditionally considered as a flow of information or data through due diligence or assurance processes to aid consumer purchasing or investment decisions. In its simplest form, it has four broad components: ethical, social, environmental and financial.
While risk management and value generation are inherent in each of these, the focus to date has been mainly on managing risk. Performance assessments are based on how effectively this is done without necessarily considering the value that could be created, and mining companies typically shoulder the responsibility of responding to community and societal expectations.
Drummond explained: “Today, participants across the value chain have varying views of responsible mineral sourcing. We see a short-term focus from the markets, yet investment capital has a long-term focus. Communities and Indigenous people are beginning to exert their rights in new ways, and stakeholders are challenging long-held orthodoxies.
“The effects are profound. Companies and investors can no longer afford to be reactive. They must engage collectively and proactively to address demands for sustainable and traceable materials.”
Catalysts for change
RESCO aims to create a mineral value chain that’s free from structural inequality, shaped by community values and which focuses on long-term value creation. Future supply chain continuity, product transparency and operational sustainability depend upon this and in 2021, RESCO launched a project called ‘The Future is X: 2040’ to kickstart its creation.
“We look to 2040 because it provides a halfway point between delivery of the United Nations’ Sustainable Development Goals (SDGs) for 2030 and net-zero commitments for 2050,” Drummond said.
Following regional dialogue events in Australia and Peru, RESCO’s members convened in London, UK, in September 2022 to share their insights. DPI Board Chair and Co-Founder, Peter Bryant, hosted the event alongside DPI’s expert team.
“In each dialogue, participants listened to community and future leaders’ priorities around social, environmental, and economic sustainability in the value chain,” Bryant said.
“The global dialogue built on that momentum. We used the Double Diamond methodology, which is rooted in systems design thinking, to lead the group during interactive sessions held over two days.”
A vision fit for 2040
Implementation of the resulting vision has already begun, and, in time, it’s effects will shift the value chain’s orientation towards sustainable development and care for people and the environment.
“Our vision brings communities and Indigenous peoples into the fold, as well as those who invest in and finance mining, mining companies, and a range of sectors, like automakers, builders of renewable energy infrastructure and jewellery-makers, all of whom use mined products,” Bryant said.
“By 2040, we would like to see solidarity for what it means to source responsibly, including an understanding of the opportunities, challenges and impacts on society.”
Going forward, protecting the environment must be a top priority, both for originally sourced and reused or recycled materials. By 2040, RESCO would like all new mines to deliver net-positive environmental benefits for land, biodiversity, climate, and water – something the industry is already shifting towards through a greater focus on natural capital.
A vital part of RESCO’s vision is that all actors in the value chain are heard and treated fairly and respectfully. Sourcing efforts can and should act as a catalyst for social and economic development, pull people out of poverty, and provide equitable commercial opportunities (in mining and other sectors), leading towards economic diversity and more resilient societies.
Indigenous people (owners of land), rights holders, and communities must be integrated into decision-making as equitable partners and have the opportunity for a direct dialogue with consumer-facing companies.
Underpinning all of this will be reliable data which will enhance transparency, decision making and actions across the value chain. This will also help consumers to understand the origins of their products and how they are produced.
Moving from ideas to actions
Having defined this vision, RESCO is now ready for action.
“We’re building out our activities during 2023,” Drummond explained. “These include creating a digital marketplace to connect companies that have similar ideas and aspirations around responsible mineral sourcing.
“Additionally, we’re working with communities to co-create spaces which foster the values of courage, authenticity, vulnerability, equity, and justice.”
RESCO is also exploring ways to build more structural equity into the minerals industry. This involves exploring existing power dynamics across the value chain (e.g. race, gender and socio-economic dimensions) and identifying ways to change the current paradigm where necessary.
“Finally, we’re working on a global strategy to spread the word about RESCO,” Drummond added. “RESCO provides a safe space for mining stakeholders to share their experiences and discuss their aspirations and concerns. There is currently no other space where younger generations, future leaders, can speak directly to senior practitioners about the way forward.”
“But, through enabling new ways of thinking and operating, progressive leaders will shift old paradigms, create transformative learning and build new connections. We invite anyone who would like to join this movement to get in touch.”