Paul Mitchell is the EY Global Mining & Metals Leader. He recently toured Canada speaking to executives in the mining and metals sector. He is based in Sydney, Australia.
Canada’s mining and metals sector is going through an intense period of transformation. Digital advances aren’t the only factors redefining the sector’s future. Growing public conversation and focus on social responsibility are influencing decisions at the executive table. For the second year in a row, miners cited licence to operate as the number one risk and opportunity facing their business.
A number of key elections and resulting government changes or potential ones to come – particularly in Africa and Latin America – are heightening this risk. Future regulation around mining licences or royalties are unknown in certain parts of the world as governments face pressure to balance economic gains with the interests of their people.
End consumers are increasing pressure on the sector, demanding ethical supply chains and a lower carbon footprint. But it’s not just the general public that’s increasing pressure.
Shareholders, and not just ones we would traditionally describe as “activists,” are driving many miners to reshape their portfolios. A growing segment of ethical investors are demanding greater transparency around environmental, social and governance efforts.
What these trends all have in common is a particular perception of the sector. This “brand” problem isn’t new for miners. The sector needs to be able to show how it’s prioritizing sustainable and inclusive growth to redefine its image as a responsible source of the world’s minerals.
Minerals that are critical not just to the digital age, but also the transformation under way to reduce carbon emissions and achieve the goals of the Paris Agreement.