Renato Urresta
Principal Consultant
ERM
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ERM: Long-Term Strategy to Thrive Beyond Pandemic

By Alejandro Ehrenberg | Mon, 09/07/2020 - 16:45

Q: Has the COVID-19 outbreak made health a more prominent aspect of sustainability?

A: Health has always been a part of sustainability but the pandemic has made it more central. Public health is under the spotlight. While it is important to deal with the COVID-19 health crisis decisively, there also needs to be a long-term view. We need to pay attention to the economic, political and cultural arenas that provide the framework for public health. Sustainability should approach society from every angle. To increase our clients’ long-term resilience, ERM has gathered experts and developed a COVID-19 task force to deliver the best sustainability practice. Resilience and the capacity to adapt are key for thriving in the uncertain scenario resulting from the pandemic.

Q: How does ERM help its mining clients to behave sustainably in the COVID-19 era?

A: Mining projects often take place in far-away regions where the state does not provide the health services it should. The pandemic has stressed societies’ needs. The actors closest to the community are feeling the most pressure and demands on mining companies are increasing. Many of ERM’s clients want to develop community engagement plans that solve present needs and crises, while also considering the long run. The idea is not to focus resources just on solving the most immediate needs that arise from the pandemic, but to create a preventive culture for the future. One of our main lines of action is to strengthen a mining project’s governance. We align companies’ social investment with government programs.

Solving pandemic-related issues is important but the solutions will not be sustainable if they do not have a medium and long-term outlook. The closure and reclamation processes of projects are also key in this framework. Companies and governments should empower local communities by means of governance and development of skills.

In a COVID-19 scenario, where immediate social needs become stressed, it is more important than ever to involve all stakeholders. ERM helps to create a space where it is easy to undertake collective planning. We look for the common denominator of interests and start working from there. We facilitate understanding by means of methodologies, like design thinking and strategic vision. Everyone should be involved in the collective vision of the project, generating symbiosis and ultimately success.

Q: Why should companies incorporate sustainability practices into their business strategy? 

A: Not cultivating a strong ESG profile will result in risks to the operation. ERM can quantify the risks of neglecting sustainability in terms of opportunity cost. We then calculate the amount of social capital that has to be generated to offset the risks. Our approach is to minimize risk and maximize benefits. Our clients maximize ROI for every dollar invested in community engagement and sustainability. Moreover, a robust ESG profile is becoming more important than ever. It is related to a company’s access to financing and how companies generate more value according to their sustainability practices. It is also important when negotiating M&A deals. ERM carries out ESG due diligence to quantify a company’s ESG profile when it enters into an M&A. We compare the company’s profile with international standards. We have a grading scale that is subsequently corroborated against the market.

Q: What is ERM doing to bring the highest international standards for water management to its clients?

A: Water management is a central issue in mining. Mining companies not only have to improve their immediate water use: they also can contribute to generate more water resources in the regions where they operate. This means paying attention to the whole hydric system. ERM is part of the Alliance for Water Stewardship (AWS), an international initiative composed of different NGOs, private and community organizations. It provides a set of criteria to guarantee sustainable water use. ERM applies these criteria to design water use programs throughout a mining project’s life span. AWS offers certifications, and ERM is authorized to certify companies under AWS standards.

Q: What digital and data-management solutions does ERM provide its clients to enhance their sustainability profiles? 

A: We can advise our clients on the best methods for planning and executing a process. We analyze the mining project and make sure that software providers are a good fit to it. ERM has a Technical Community called Information Solutions that is in charge of this. It makes sure that our ESG interventions reach the highest operational standards by means of effective use of technology. We do not develop software; rather, we help clients identify the best resources in the market. We help them to complete an agnostic technology assessment. Once we have implemented a digital infrastructure for the mining project, we develop KPIs to measure sustainability: water use, C02 emissions, recycling rates, and more. We create databases and generate indicators digitally.

Q: How is ERM collaborating with other sustainability leaders to benefit the mining industry?

A: Mining closure is an essential component in sustainability plans. Every social program, every investment and management decision have to be made with the eventual closure of the mine in mind. To raise awareness concerning this issue, ERM has published a document titled “Integrated Mine Closure: Good Practice Guide” in collaboration with ICMM. The guide promotes the best standards and practices to create a closure plan: a transition plan, progressive closing, strategies for personnel relinquishment and closure governance, among others.

ERM is a leading global provider of environmental, health, safety, risk, social consulting services and sustainability-related services. It has more than 5,500 people in over 40 countries and territories working out of more than 160 offices. The company delivers innovative solutions to the world's leading organizations.

Alejandro Ehrenberg Alejandro Ehrenberg Journalist and Industry Analyst