A survey of global mining executives shows that nearly half think the risk of losing their social license to operate is the top risk for the sector, according to an article in The Sydney Morning Herald.
Indeed, license to operate has figured at pole position in the top-ten list of mining sector risks for the second year running, according to the 12th annual EY Top 10 Business Risks And Opportunities 2020 Report.
Why is ‘social license to operate’ so top-of-mind that 44% of mining executives flagged it as the greatest threat to their business?
According to Paul Mitchell, EY Global Mining & Metals Leader, factors such as political turbulence from elections, consumers’ demand for a transparent and ethical supply chain, and rising climate-related shareholder activism have combined to boost the ‘license to operate’ risk.
Respondents placed ‘Future of Workforce’ at No. 2 as companies face up to the increasing demand for, and difficulty attracting the digital and data-related skills needed to support the future of mining.
At No. 4 was placed ‘Reducing carbon footprint,’ a risk that is a new entrant this year. “The transition to a low-carbon economy is underway and the pressure to accelerate this transition seems to grow every day,” the report said. Indeed, there was a discernible increase in ethical (ESG) investing and stakeholder pressure.
“Companies must show how they’re working towards sustainable and inclusive growth to redefine the sector’s image as a responsible source of the world’s minerals,” said Jeff Swinoga, EY Canada Mining & Metals Co-Leader.
Read the full article HERE.
Feature image source: EY