As Mexican mining companies are heightening their efforts to mitigate carbon emissions and join the United Nations (UN) Sustainable Development Goals (SDG), the UN is also collaborating with these companies to facilitate this transition and enhance the positive impact mining companies could have.
In the UN’s document “Remarks to the Global Roundtable on Transforming Extractive Industries for Sustainable Development,” UN Secretary General António Guterres referenced the 81 countries whose mining extraction represents a quarter of global the GDP and impacts close to half of their population.
“Extractive industries have a great potential to drive growth, support sustainable development and reduce poverty in developing countries. Oil, gas and mining industries are being demonized. Nevertheless, the world needs these activities for the energy transition, which requires minerals, and as an activity toward development and poverty reduction,” said Ulises Neri, Vice Chair Latin America, Expert Group on Resource Management, UN.
Nevertheless, Neri explained that these industries are experiencing social, financial and political pressure to make sure that companies do not see the UN’s 2030 Agenda as an optional checklist.
“Ideally, all mining companies with a project would have to look for ways in which that plan can respond to the 17 elements that the 2030 agenda proposes. The UN wanted to ensure that this is happening by creating the UN Center of Excellence for Mexico and Latin America,” Neri explained.
The Institution of Civil Engineers (ICE) will assist the institutions of the extractive and energy industries in Latin America, both from the public and the private sector, in meeting their sustainability goals within the framework of the SDGs. Its target areas are mining, hydrocarbons, renewable energy, energy efficiency and efficient resource management.
Neri explained ICE’s efforts are based on a qualitative and quantitative methodology that will integrate the UN’s Resource Classification (UNFC) and the UN’s Resource Management Systems (UNRMS).
The UNFC is in charge of devising strategies to manage budgets and resources to manage industry processes and justify capital allocation. The UNRMS is based on 11 principles that provide a holistic vision toward sustainable development. These can then be used to develop standardized processes, facilitate resource management, support decision-making, measure the actual progress of a project, consider metrics that contribute to sustainable development to ensure efficiency in this process.
For mining companies, integrating these two programs will facilitate the implementation of the 2030 goals into their projects. Neri said that the overall goal of this integration is to provide each company with a sustainably-oriented corporate vision, which will generate a better reputation in society, improve the relationship with your customers and suppliers, reduce operational risk and increase project profitability by fostering higher credibility with investors and stakeholders. It allows access to financing with lower rates and to sources of private capital that consider ESG factors to be important. Complying with the SDGs will also strengthen the integration of responsible investment portfolios with a focus on medium- and long-term financial returns.
ICE is about to start pilot tests in Mexico, a country chosen to lead the project due to its centuries-long tradition in mining, strong oil production, leadership in Latin America and proximity to the north. The three selected projects were operated by Almaden Minerals, Starcore International Mines and Argonaut Gold.
“With these companies, the goal is to align government policies with their corporate practices in ESG terms. We will begin aligning with their shareholders, do a real diagnosis of their situation to create a sustainable transformation plan, which based on efficient information management will generate sustainability-focused corporate reports,” Neri shared.