Expert Insight

Gold mining can lead drive toward SDGs

Industry has aligned itself with broader ESG objectives to deliver on targets

March 25, 2021

John Mulligan

Expert Insight
|
February 21, 2020
|

Given gold’s relative rarity and timeless precious status, it is sometimes easy to overlook that gold is all around us and plays a critically important role in many aspects of human society. Gold touches a part of nearly all our lives, even if we aren’t aware of it.

We rely on it every day in our electronic devices including, of course, the smart phone or computer on which you are very likely reading this. We wear it as jewellery, often to signify the most important events in our lives. It is even present in medical diagnosis and treatment applications.

Some of this simply reflects gold’s unique physical properties. Its special ‘gleam’ and ‘glow’ has, from prehistory, been associated with power, both earthly and otherwise – including, for many civilisations, symbolising deities and cosmic forces. On a more practical level, it is a uniquely malleable and resilient metal that conducts electricity, is bio-compatible (not rejected by the human body) and does not corrode or tarnish over time.

These factors, taken together, may explain why gold is so often intimately linked with the ability to protect, and to provide enduring legacies, and why in many cultures around the world we give and receive gold as ceremonial gifts and awards, to mark major milestones and peak achievements.  

And, as a proven long-term store of value – protecting wealth and purchasing power across time, market cycles, and national borders – gold has offered financial security to individuals and countries for millennia.

Gold is so very much more than a commodity and its value is rooted in its remarkably diverse meanings, roles, and applications in history, society and in the global economy.  

But while in many ways gold may be ubiquitous, it is also a scarce natural resource that is hard to find and requires great effort to produce. This has many implications, including the fact gold mining can have a very significant impacts on the locations in which gold is found and extracted. And these have not always been positive.

Modern mining companies therefore have a responsibility to work together with host governments and communities to extract gold in a way that creates sustainable benefits for the people that reside where gold is found and demonstrates a clear awareness of the local environment, and their obligations to protect and preserve it.

We very much hope many more gold mining companies will adopt these principles, ensuring wider progress across the whole sector

With this in mind, and to help further guide the industry, the World Gold Council (WGC), in collaboration with its member companies and after extensive consultation with a wide range of industry stakeholders including governments, communities, civil society and NGOs, launched the Responsible Gold Mining Principles (RGMPs) in September 2019.  

This is an ambitious set of 51 individual principles that covers all material aspects of environmental, social and governance (ESG) related to gold mining, including water management, climate change, gender diversity, anti-bribery and community engagement, just to name a few. These principles set very clear definitions and expectations for the entire industry as to what constitutes responsible gold mining.

To meet societal and investor expectations for enhanced transparency and accountability, company performance against the RGMPs will be publicly disclosed and independently verified. Third-party oversight will help provide the wider market with greater confidence that gold is a demonstrably responsibly sourced product.

Implementation and full conformance with the RGMPs are mandatory for WGC members, and we very much hope many more gold mining companies will adopt these principles, ensuring wider progress across the whole sector.

During the development of the RGMPs, the extensive two-year consultation period also included a process of reviewing and mapping RGMP performance outcomes against the objectives of the UN’s Sustainable Development Goals (SDG) to ensure their meaningful alignment, with a clear relationship between RGMP impacts and key development goals.

By design, therefore, implementing the RGMPs in an effective manner is likely to directly contribute to progress on many of the SDGs.

Showing alignment toward a greater good

To help summarise and communicate some of these potential impacts and gold mining’s development potential, the WGC recently released a report, Gold Mining’s Contribution to the UN Sustainable Development Goals, reviewing how leading gold mining companies might have clearly contributed to specific SDGs.

Importantly, the report also addresses how responsible miners have pro-active strategies to mitigate the potential negative social and environmental impacts of the industry, which, if left unchecked, could otherwise reduce or obstruct development progress. The report also looks at key challenges for the industry such as the COVID-19 pandemic, improving social and environmental practices in the artisanal mining sector, and reducing the industry’s climate impacts.

The wide-ranging case studies presented in the report are grouped under five themes: Global Partnerships (SDG17), Social Inclusion (SDG 5,10,16) Economic Development (SDG 1,2,3,4,8,9) and Responsible Operations, Energy and the Environment (SDG 6,7,12,13, 15).

Significant achievements include gold mining companies’ efforts to tackle disease; AngloGold Ashanti’s partnership with the Ghanaian government in the fight against malaria being a notable example. The company’s outreach programmes, together with improved community access to diagnostics and therapeutics through the mine’s hospital facilities, resulted in the incidence of malaria being reduced by 74% over three years. And the methodologies of that programme were then used to reduce malaria in other parts of the country.

Building on a range of strong partnerships, the gold mining industry is also working on improving social inclusion as set out by SDGs 5,10 and 16. Historically, women and minority groups have been under-represented in mining and the industry is now working to address these issues and striving to provide more inclusive working environments.

More diverse and inclusive workplaces bring a range of additional benefits. On a very practical level, for example, it is well documented within the mining industry, most recently by Endeavour Mining, that women are often more effective and efficient drivers of large vehicles and operators of machinery, with an impressive safety record and requiring less maintenance on the equipment they use.

Gold mines can catalyse and stimulate a range of development opportunities and act as an engine of economic growth

And beyond the mine, companies are also attempting to empower women in communities, such as those surrounding Kinross Gold’s mine in Mauritania, where the company seeks to establish economic opportunities for local women through small business training and the funding of micro-projects.

The WGC has previously documented how gold mining creates direct and indirect job opportunities for local people, which typically raises the household incomes of employees and their dependents, which in turn can stimulate local economic activity and generate wider wealth creation opportunities. We have previously estimated 70% of total gold mining company expenditures flow to local people through employee wages and payments to suppliers and contractors.

Furthermore, the improved infrastructure and enhanced social and community facilities that often accompany the opening of a modern mine can offer a range of benefits, beyond the purely economic, to support the health and wellbeing of not only the workforce but often also the wider local population.

The gold mining sector has long been able to point to its support for the wider provision of local medical and educational facilities, and this work continues, such as Golden Star Resources’ building of 43 school classrooms and dormitories near its operation in Ghana.

But there are also initiatives seeking to develop broader economic activity and capacity, as witnessed in Resolute Mining’s investments in 20 micro-projects near its mine in Mali. These projects were selected by the local authorities to help improve integration with the surrounding economy and provide opportunities for sustainable legacies.

The report also looks at how responsible miners are protecting the environment, including water resources, while seeking to contribute to the transition to a low-carbon economy. These initiatives also often have beneficial impacts for the wider community. IAMGOLD has a project, in collaboration with both government and community leaders in Burkina Faso, which provides drinkable water for over 100,000 people.

And the WGC, in its 2019 work on gold’s climate change impacts, has described how Agnico Eagle Mines, for example, is working with a coalition of Inuit representatives to look at alternative energy sources in Nunavut to reduce its dependency on diesel fuel for energy. The long-term goal of the coalition is to build hydroelectric transmission and fibre-optic infrastructure to deliver cleaner, more sustainable energy across the region and for the benefit of future generations. A similar initiative by Agnico Eagle in Mexico is poised to bring a steady supply of cleaner electrical power to the La India mine, while also benefiting local communities and families.

COVID-19 has made working in effective partnerships even more important, and WGC member companies, alongside others in the mining sector, were quick to respond to some of the immediate challenges created by the pandemic.

Gold miners have embarked on humanitarian initiatives and provided vital assistance to their host nations and communities, ranging from making sizeable financial contributions to support medical services, to launching screening tests and offering mine-funded hospitals to provide enhanced critical health care for local communities.

If gold mining companies are to be sustainable and successful, they need to be recognised as welcome partners and good neighbours, striving in collaboration with their host communities to turn mineral wealth into a driver of social and economic development.  

Gold mines can catalyse and stimulate a range of development opportunities and act as an engine of economic growth, especially in poorer, rural locations where there are often few alternative avenues for productive employment and community advancement.

Looking ahead to 2030, there is much that needs to be done, and the impacts of Covid-19 mean that achieving the SDGs will require even more of a concerted effort from governments, businesses, and wider society.

But the WGC believes the gold mining industry is well placed to help advance the SDGs and the industry’s leaders are committed to making a demonstrable contribution to progress.

Expert Insight
|
|
March 25, 2021

Like the article? Spread the word

Our Partners

In association with