World’s largest mining firms ‘selectively reporting’ on positive sustainability progress, report warns
Many of the world's largest mining companies are choosing to omit mentions of their negative environmental and social impacts from their annual report, highlighting and overstating positive impacts instead, a new report has warned.
In its latest annual report, published today (24 February), the Responsible Mining Initiative (RMI) ranks 38 of the world’s largest mining firms on their efforts to deliver against what it describes as 10 “basic principles” of responsible business.
Pledges and progress are tracked across a number of social, economic and environmental metrics – the latter pillar of which covers topics including life-cycle analyses; climate impacts; energy efficiency; water stewardship; biodiversity and preparedness for climate-related emergencies such as extreme weather events.
The RMI tracked whether each firm’s pledges – and the actions they had taken to deliver them – were aligned with the UN’s Sustainable Development Goals (SDGs) framework. The RMI was specifically looking for action against the SDGs’ underlying action points in addition to its broad, 17-point agenda.
On the environmental factors collectively, no analysed firm scored more than 3.5 points out of a possible six. Similar scores were recorded across other metrics also.
The RMI noted that the businesses ranked the highest had only delivered “modest overall improvement” against the range of issues assessed between 2018 and 2019, while those which ranked lowest have made “weak efforts to track, review and act to improve the effectiveness of their actions”.
Despite this poor progress, the RMI noted that many of the assessed firms were highlighting or overstating their positive SDG contributions in their annual reporting. The Initiative also tracked a trend among assessed companies of failing to report negative impacts towards the SDGs.
It has, therefore, said that the sector is at risk of “SDG-washing” – claiming SDG alignment while failing to deliver adequate positive impact, at a time when just one decade remains to deliver across the Global Goals agenda. The RMI is warning that this trend could lead to a lack of trust among investors, consumers and employees, which will present as a negative financial impact in the coming years.
In order to buck this trend, the Responsible Mining Foundation’s chief executive Hélène Piaget is calling on analysed firms and those elsewhere in the sector to shift to more open data formats on environmental, social and economic issues. Such data should be provided at individual mine site-level, updated regularly and accessible digitally, she is urging.
“While the trust-deficit with society is recognised as the number one risk for mining companies, the RMI Report 2020 acts as a prompt to the industry to eliminate the need to respond to multiple information requests,” Piaget said.
“By proactively making data available… companies can help to build trust, limit risk, and show respect. In fact, more proactive data disclosure will reduce the demand for companies’ reporting.”
Nothing to report?
The UN Global Compact (UNGC) first began warning of the business and environmental risks of “SDG-washing” by businesses in 2018, around three years after the Global Goals framework was published.
In a practical guide for businesses seeking advice on prioritising which SDG targets to act and report on, the UNGC emphasised that – despite 193 countries, more than 10,000 companies and investors with more than $4trn in assets have pledging their support to the SDGs – the world ultimately remained off-track to deliverance, with pledges more often than not being followed through.
After a string of reports showed that a huge proportion of firms to have made SDG pledges have not yet to set any measurable targets related to the Goals, nor are they monitoring progress against them, edie hosted a webinar whereby experts discussed how sustainability and energy professionals can drive engagement with the SDGs and spur tangible action.
The question of whether businesses should report on their negative contributions towards the SDGs was repeatedly raised and addressed during the session, by speakers from BT, the British Retail Consortium (BRC), the UK Stakeholders for Sustainable Development (UKSSD) and DNV GL.
The UK Government does not currently mandate corporates to report in line with the SDGs. However, since the webinar aired, it has introduced the Streamlined Energy and Carbon Reporting (SECR) framework. Moreover, The Financial Reporting Council (FRC) is set to launch a major review into the quality of how companies and auditors are reporting on climate change impacts and risks this year.