Investors worth $25trn push back on ‘laggard’ mining companies
A coalition of investors are set to engage with 100+ mining companies to adopt global tailings standards.
A $25trn investor initiative, including the Church of England Pensions Board, have vowed to target “laggard” mining companies not committing to international standards.
New research presented at a global roundtable of the Investor Mining and Tailings Safety Initiative revealed that 77 major publicly listed mining firms have now committed to adopt the Global Industry Standard on Tailings Management (GISTM), however 126 smaller companies are yet to commit.
Hence, at the roundtable, convened by the £3.2bn Church of England Pension Board, the $25trn investor initiative vowed to lead on engaging with these remaining companies to implement the GISTM within the next 12 months.
The roundtable was held of the eve (24 January) of the fifth anniversary of the Brumadinho disaster which led to the loss of 272 lives when a tailings dam collapsed in Brazil in 2019.
Those companies not committing to the standard are clearly labelling themselves as an increased risk in investors’ portfolios.
Church of England Pension Board
Adam Matthews, chair of the Investor Mining and Tailings Safety Initiative and chief responsible investment officer for the Church of England Pensions Board said: “Those companies not committing to the standard are clearly labelling themselves as an increased risk in investors’ portfolios, and for insurers, banks and to the communities and environment in which they operate.
“They also undermine efforts by the whole sector to address the systemic issue of tailings waste and as such they will be the intense focus of a renewed investor engagement.”
The Church of England Pension Board are known for taking an active stance on big emitters, with the fund offloading its stake in supermajor Shell as it declared that it was looking to end all of its investment in the oil and gas sector last year.
Investors joining the Church of England Pension Board in the initiative include Border to Coast Pension Partnership, CalSTRS, Lothian Pension Fund, UBS, USS, Swedish AP Fund AP2, AP4, AP7 and Allianz Investment Management.
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Patrick Peura, ESG engagement manager for Allianz Investment Management said: “The Investor Mining and Tailings Safety Initiative has been critical to not only show the benefit but also the need for investors to convene on such critical systemic issues in the mining sector.
“Companies not reporting in line with the standard raise the serious concern that they have not yet taken this opportunity to align their assets and operational standards. This is necessary to appropriately reduce risks against human and capital loss – something that is not acceptable in any industry.
“We are therefore committed to lead, along with other investors, the continued engagement with these non-responding companies.”
Companies not reporting in line with the standard raise the serious concern that they have not yet taken this opportunity to align their assets and operational standards.
50% of market committed
The new research also revealed that alongside the 77 mining companies who have committed to the standard, an additional 36 either committing to reviewing the standard or are in the process of implementation.
Taken together these 113 companies represent 64.43% of the market by capitalisation of all listed mining companies. Of which those committed to GISTM are 51.76 of the market.
Matthews added: “Over half of listed mining firms, by market value, are now committed to the GISTM. This is a significant step by many companies to implement what is an exacting best practice standard. It means this Standard is now the norm for the market.”
