Environmental, social and corporate governance (ESG)

 Fig. : Environmental, social and corporate governance (ESG)

Source: Stockwerk Fotodesign, Adobe Stock.

The emergence of ESG

The previous learning units 7.1: Preliminary remarks on the view on companies and organisations and 7.2: Corporate social responsibility have already discussed how CSR can help to view companies not only in terms of their economic performance, but also in terms of their social and ecological commitment. In this sense, CSR can overlap with sustainability models and the SDGs, particularly regarding corporate actions.

To encourage businesses worldwide to adopt sustainable and socially responsible policies, the UN Global Compact was launched as a voluntary initiative in 2000. It is based on ten universal principles in areas like human rights, labour, environment, and anti-corruption and marked one of the first major efforts to formally involve the private sector in global sustainability.

In 2004, together with major financial institutions, the UN Global Compact issued a report titled "Who Cares Wins", where it introduced and defined the notion of ESG as “emphasising the importance of environmental, social, and governance factors in investment decisions”. This was when the concept gained global prominence for the first time.

The SDGs help to integrate and highlight companies’ engagement in ESG issues as they represent the first global UN goals that holistically address the contributions of all stakeholders, including businesses. ESG frameworks provide companies and investors with practical tools and metrics to assess how corporate activities contribute to or impact the SDGs. For example, carbon emissions (E), labour practices (S), and board diversity (G) directly relate to SDG targets. Thus, since the early 2000s the ESG movement has grown from a UN CSR initiative into a global phenomenon. For instance, while in 2006 “63 investment companies (…) with US$6.5 trillion in assets under management (AUM) [were] incorporating ESG issues”, following the Global Sustainable Investment Alliance (2023:5), “$30.3 trillion (...) [had been] invested globally in sustainable investing assets” in 2022.

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 Med. : What is ESG? Introduction to Environmental, Social and Governance

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Time to watch 4m7s

Further listening: Podcasts about ESG and Mining

Web­source

Further listening: Podcasts about ESG and Mining

MSCI (2021, December 10).
We need miners and cheap drugs. Episode 161.
Time to listen 21m

Sustainability Leaders (2021, March 16).
The Evolution of ESG in Mining. Episode 33.
Time to listen 31m

in depth

Examples: What does the mining sector do itself?

Mining Principles – a global initiative

The International Council on Mining and Metals (ICMM) promotes responsible mining through its 10 Mining Principles. “They set good practice environmental, social, and governance requirements for company members through a comprehensive set of performance expectations and related position statements. Their implementation supports global targets, including the UN Sustainable Development Goals and the Paris Agreement on climate change. By incorporating robust site-level validation and credible assurance of corporate sustainability reports, our Mining Principles aim to maximise benefits for host communities while minimising negative impacts and addressing societal concerns.” For the ICMM it is important that these principles apply over the whole mining life cycle.

Further reading:

Further reading:
ICMM (no date). Responsible Mining.

Further reading:
Sieger, Johannes / Lottermoser, Bernd G. (2024).
Chapter 3: Sustainable development and mining.
In Lottermoser, Bernd G. / Sieger, Johannes /Tost, Michael (Ed.),
Mixed Reality Handbooks for Mining Engineers – Volume 1. Part I – Sustainability in Mining. Part II – Mine Planning. (pp. 48-50). Leykam.

Towards Sustainable Mining – an Example from Canada

The Canadian mining industry initiative Towards Sustainable Mining (TSM) describes itself as supporting „mining companies to turn high-level environmental and social commitments into action on the ground. At the same time, it provides communities with valuable information on how operations are faring in important areas, such as community outreach, tailings management and biodiversity. Participation in the TSM initiative is mandatory for all MAC members for their Canadian operations.“