By Will Bugler
A new report developed by Acclimatise for the International Council on Mining and Metals (ICMM) shares good practice from some of the world’s leading companies on how to build operational resilience in the mining and metals sector. Launched last week at WWF’s ‘Water Summit 2019’, the report provides practical guidance to help build climate resilience by enhancing the sustainability of communities and ecosystems, limiting future liabilities, safeguarding business continuity and making prudent investments.
The report, Adapting to a Changing Climate: Building resilience in the mining and metals industry draws on the experience of ICMM’s 27 member companies to highlight how the industry can respond to climate change. “Our climate is changing, and this presents challenges for the mining and metals sector.” Said ICMM CEO, Tom Butler. “Understanding this challenge, ICMM has collated insights and developed tools that can support our members and any responsible mining company to build resilience by identifying and properly managing these risks.”
The report shows that ICMM member companies are already experiencing climate risks to their operations. “Flooding, drought, increased storm intensity, greater variability of water supply and an increasing number of high-temperature days have led to reduction in or shut-down of production, increases in capital expenditure, health and safety impacts and made vulnerable communities more prone to social unrest. Future climate variability and climate change will likely exacerbate these impacts.” The report says.
The report also identifies opportunities for the sector to adapt and explains that new policy and stakeholder positions on climate risk are putting increased pressure on companies to assess and manage their climate risk exposure. In particular, ICMM members say that the recommendations of Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD) has had a significant impact. The TCFD sets out a framework for the voluntary disclosure of climate-related risk and opportunities. It identifies physical risk as one of two categories of climate-related risk, alongside transition risk associated with a lower-carbon economy. Finally, the report offers a step-by-step approach for mining and metals companies to assess the climate risks to their operations.
Lead author, Anna Haworth from Acclimatise, highlights some of the benefits of taking a robust, holistic and scenario-based approach to identifying and managing physical climate risks. “By responding to the risks and opportunities associated with future climate change methodically and comprehensively, companies in the mining and metals sector can start to implement prudent and cost-effective actions that both ensure resilience and satisfy the demands of insurers and investors. By building climate resilience today, companies can reap rewards tomorrow: by limiting future liabilities, ensuring business continuity, making sensible investments, and ensuring the sustainability of communities and ecosystems.”
ICMM’s member companies reported that they are aware of the importance of adapting to the physical impacts of climate change, and that climate resilience is needed to secure virtually all components of the mining system. In order to respond effectively, the sector requires increased collaboration across the functions of mining operations, and between individual operators and third party stakeholders. In addition, further capacity building efforts are necessary to support staff on integrating physical climate risk, opportunity and resilience within everyday decision-making.
As ICMM’s position statement on climate change recognises, the scale of the challenge means that genuine leadership is required from all parts of society, and ICMM, with its member companies, are fully committed to being part of the solution.
Download the report here.