How Mining Corporations Can Combat Indigenous Disparity
Promoting and protecting the rights and overall wellbeing of indigenous populations continues to present a problematic challenge. The global mining industry represents one of the most significant bodies faced with this challenge of disparity, existing between its corporations and the indigenous populations affected by local mining operations. Whether it is insufficient compensation, misrepresentation, or pure exploitation, there’s simply too great a difference between the wants and needs of the indigenous population and those of mining corporations. Fortunately, the global mining industry does appear to be an old dog that can learn new tricks.
While the natural momentum of industrialization continues to create the cantankerous catalyst that casts this shadow on indigenous populations, the corporate profits behind this momentum are likely the biggest culprit. It’s especially easy to make this assumption when we see that net profits for the top 40 global mining companies is down by approximately 50 percent from just a few years ago, marking a walloping drop of about $68 billion. What’s more, CEO’s of the top 40 global mining companies are certain that increasing supply is critical for the mining industry's future.
Throughout human history, whenever dominant neighboring peoples have expanded their territories or settlers from far away have acquired new lands by force, the cultures and livelihoods - even the existence - of indigenous peoples have been endangered. The threats to indigenous peoples' cultures and lands, to their status and other legal rights as distinct groups and as citizens, do not always take the same forms as in previous times. Although some groups have been relatively successful, in most parts of the world indigenous peoples are actively seeking recognition of their identities and ways of life.
Your Mine is Mine, Too
What are some specific areas that mining corporations’ need to not only look at, but actually do something about? It shouldn’t be any significant surprise that the top needs of minority, indigenous communities mirror those of the majority: education, health care, access to social services, and overall improved quality of life. Among the problems plaguing the indigenous disparity equation is that top mining corporations often perceive the needs of local communities as roadblocks instead of roadways to improved profits.
Fortunately, there does appear to be growing numbers of mining corporations coming around to being a part of comprehensive social solutions instead of widening the rift of social disparity, even if they’re motivations are ultimately driven by profit. Mining corporations are finding motivation in areas such as securing financing and regulatory approvals, increasing access to qualified employees, and reducing the risk of work stoppages and other disruptions.
One Indigenous Model Doesn’t Fit All
Impeding progress of this initiative is the absence of a one-size-fits-all solution. Corporations have actually been taken steps backward through the assumption that simply because a solution worked for one corporation and its local, indigenous community that it would automatically work for their own. The most effective solutions are not generic ones that can simply be plugged into any community around the world. While the principles themselves are universally applicable, solutions that have worked for individual mining corporations need to be used as general guidelines. From there, mining corporations and outside councils need to work alongside the indigenous population to unearth their unique needs and values. From this, mining operations can start to develop standard operating procedures that promote the improved health of corporate profits and local communities.
Learning About Local Communities Again, for the First Time
We can start to see part of the solution to indigenous disparity by looking to tie in the social consciousness element. However, we run the risk of oversimplifying the solution by stating that mining corporations simply need to learn about their local communities. Mining corporations need not just learn the culture of their local communities. Relearning one’s own corporate culture bears vital importance as well. This introspective relearning process has already helped mining companies gain new perspective. And by opening themselves up to new opportunities for their local communities, they’ve in turn opened themselves up to new opportunities for their own corporate wellbeing.
Great importance should be placed on learning the history and culture of local indigenous people from the inside out. This requires a comprehensive and personal relationship bolstered by free and open, two-way communication between mining companies and local communities. Among the top goals here should be that of building relationships and genuinely earning mutual trust. Dr. R. Anthony Hodge, President of the International Council on Mining and Metals comments on this approach of generating community trust, “Generating this kind of trust is not possible through following the kind of paternalistic approach that characterized the industry only a few decades ago. Progressive mining companies see themselves as a member of the community – a cog in the wheel – not even the dominant member.”
Increased Health and Wealth for Corporation and Community
Sustainable, lasting relationships between mining corporations and local, indigenous populations is vital to attaining and retaining the mutual benefit of mining operations. Mining operations void of genuine regard for local communities and long-term sustainability will continue to fall alarmingly short of promoting the wellbeing of indigenous populations.
We obviously can’t expect an immediate turnaround, but growing awareness of the disparities between mining corporations and the local communities they affect have been gaining traction, leading to increased action. As the mining industry strengthens its grasp on the concept that closing this gap can lead to increased health and wealth on both sides, mining will surely move forward on a positive path.
Low carbon world needs $1.7trn in mining investment
According to a new report from consultancy Wood Mackenzie, mining companies need to invest nearly $1.7trn in the next 15 years to help supply enough copper, cobalt, nickel and other metals needed for the shift to a low carbon world.
Cutting carbon emissions
The United States, Britain, Japan, Canada and others raised their targets on cutting carbon emissions to halt global warming at a summit in April hosted by US President Joe Biden.
Meeting those targets will need large-scale deployment of electric vehicles, storage for power generated from renewables and electricity transmission, all of which require industrial materials, such as lightweight aluminium and metals used in batteries such as cobalt and lithium.
Wood Mackenzie analyst Julian Kettle calculated miners needed to invest about $1.7trn during the next 15 years to “deliver a two-degree pathway - where the rise in global temperatures since pre-industrial times is limited to 2°C”.
“At an industry level, there seems to be reticence around investing sufficient capital to develop future supply at the pace and scale demanded by the energy transition (ET),” he said.
Mining firms are wary of making heavy investments after their experience of the last decade when they invested in new capacity just as demand peaked, leading to a collapse in prices and revenues. They also need to please investors, who are unlikely to want to see dividends diverted to capital spending.
Rising demands of investors related environment, social and governance (ESG) issues further add to the challenge.
Australia, Canada and Western Europe carry a low ESG risk but some of the best resources are in high-risk areas, such as Democratic Republic of Congo, which sits on about half the world’s cobalt reserves according to the U.S. Geological Survey. “Given the need to meet tough decarbonisation and ESG targets, Western governments, lenders, investors and consumers will need to get comfortable operating in jurisdictions where ESG issues are more complex,” Kettle said.
Kettle said government support was needed to help miners comply with ESG issues to ensure production from high-risk areas was conducted in an acceptable way to consumers.
“Then, and only then, will the West be able to secure sufficient volumes of the raw materials needed to pursue the energy transition in the timescales envisaged.”