mining and sustainability: why transparency makes a difference - ben peachey
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Ben Peachey of the International Council on Mining & Metals discusses the importance of transpTRANSCRIPT
Mi i d t i bilit hMining and sustainability: why transparency makes a differencetransparency makes a difference
Ben Peachey / Communications DirectoryReputation in oil gas and mining / 20 January 2011
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Overview of presentationp
ICMM t l ICMM at a glance
Member commitments
Public reporting and independent assurance
Reputational benefits of transparency
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ICMM at a glanceg
Gl b lGlobal
CEO led 30 Association
18 member companies
Association members
p
Over 800 sites in 54 countries54 countries
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Where do we come from?
4 regional reports23 global workshops 175 research projects50 000 people involved
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50,000 people involved
Member commitments
10 Principles
1. Implement ethical business practices and apply good corporate governance2. Integrate SD in corporate decision-making 3. Uphold fundamental human rights 4. Manage risks based on sound science 5/6. Improve EHS performance7. Conserve biodiversity & participate in integrated land use planning8 Encourage life cycle approach to materials management8. Encourage life cycle approach to materials management9. Contribute to community development 10. Publicly report, independently assure and engage openly and transparently y p p y g g p y p y
Mi i d P t t d A Mi i P t hi f D l t
6 Position Statements
Mining and Protected Areas Mining: Partnerships for DevelopmentClimate Change Mining and Indigenous PeoplesMercury Risk Management Transparency of Mineral Revenues
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Mercury Risk Management Transparency of Mineral Revenues
Delivering on the commitmentsg
Robust entry criteria and process
Clear performance expectations
Reporting... and redress?and process expectations redress?
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ICMM member performance – 2009 reportsp p
C li t bReporting/assurance commitment Compliant membercompanies
P li li t ith i i l 15Policy alignment with principles 15
Assurance of policy alignment 9
G3 application level
10 - advanced6 - intermediate1 beginner1 - beginnerTotal: 17
Use of GRI sector supplement 16Use of GRI sector supplement 16
Assurance of G3 application level 13
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Multi-stakeholder initiatives
A risk assessment framework for relations between EI companies and public and private security providers to ensure respect for human rights
Multi-stake-holderinitiatives Verification/publication of company payments and government revenues from EI
sector. Civil society involvement to increase government accountability
Industry-
Mandatory principles, reporting and third party assurance
ledinitiatives
NGO calls to further toughen reporting & governance requirements
IFC Performance standards: ‘do no harm’ social and environmental safeguards
European Multi-Stakeholder
Equator principles. Financial industry benchmark for social & environmental risk t d t i j t fi i
Gov’t / i t Stakeholder
Forum on CSR
US government
assessment and management in project financing
Dodd-Frank Act. Reporting requirements for companies that source minerals from h DRC h l h d f f f l i di l f
inter-gov’tinitiatives
US government the DRC; health and safety performance of coal companies; disclosure of payments to governments
Why bother with assurance?y
Company benefitsBetter reputation with stakeholders
• Internal improvements
• Trust and credibility
M i f SRI/SD i di• Meets requirements of SRI/SD indices
Main benefits• Demonstrates organisation’s commitment to SD, as basis for
better stakeholder relationships
• Increases confidence and credibility in the assured SD processes
Better decision making
and information
• Builds and protects market reputation through independent confirmation of compliance to stated standards/ guidelines
decision-making• Drives performance improvements and assists future strategic
decision-making
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Parties to assurance – company, assurance p yprovider & intended users
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Do sell-side analysts give a XXXX?y g
Investigated overall impact of CSR g pstrategies on securities analysts recommendations (16yr horizon)
Examined perceptions of analysts on Examined perceptions of analysts on value creation (or value destruction) potential of CSR strategies
Initially, CSR strategies perceived as value-destructing. Later, CSR strengths seen as value-creating: shift from sell to buy recommendations
Higher ability analysts more likely to reward CSR strengthsreward CSR strengths
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Licence to operatep
Rio Tinto - Madagascar
ADD Pics of each operation
Xstrata - Peru
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Reputational benefits
“Strongly” + “Tend to Agree ” All Stakeholders 2007–2010
Reputational benefits
71
Strongly + Tend to Agree, All Stakeholders, 2007 2010
Moving members
76
Moving members towards higher standards
2010
2007
Moving members towards higher
standards
“Major” + “Medium Contribution,” All Stakeholders, 2007–2010
67
Raising industry standards 2010Raising industry 61
a s g dust y sta da ds
2007
g ystandards
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Transition to Sustainable Development
“4” + “5 (Excellent) ” All Stakeholders 2007–2010
p
38
32
42
Forest
ICMM member companies
4 + 5 (Excellent), All Stakeholders, 2007 2010
20
2722
21
Mining
Forest
2010
15
19
2017
14Packaging
Electrical utilities 2010
2007
18
16
14
15
Oil & Gas
Chemical
ICMM members’ better performance is evidence that the ICMM principles and guidelines have a very positive effect. In light of the recent oil and gas environmental disasters that have occurred (i.e., the Gulf of Mexico oil spill), it is perhaps not surprising that stakeholders have given the oil and gas industry the lowest rating of all
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industries tested.
2007 Subsample: Those who have heard of ICMM (n=623)
In the end...
Better reputation
Transparency dand
accountability
Better decision-making
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For further information l t tplease contact:
Ben Peachey, Communications Director
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