RRM 2024 - Critical Choices - Day 1 in review

Illuminating first session of Responsible Raw Materials 2024 !

This entire week will focus on exploring innovative models, enabling risk-informed decision-making and fostering new collaboration to de-risk and redesign responsible mineral value chains.

Following previous editions on?Responsibility, the?ESG Toolbox, the?Just Transition?and the?Criticality of Trust, this fifth Responsible Raw Materials online conference was opened by Sarah Gordon and dedicated to Responsible Raw Materials co-founder Rose Clarke . It will spotlight?forward-looking redesign?ideas for the businesses, linkages and operations that make up mineral value chains, and allow open discussion of how these new models can mitigate threats, realise opportunities and connect with one another to create new systems for resilience, sustainability and shared benefits.

As the whole world discusses “de-risking” it’s obvious that the term has very distinct meanings and uses, with policy often not adequately reflecting private sector perspectives. Leading industrial markets are reshaping industrial policy and proposing “new partnership” models to resource-rich countries in a bid to improve resilience and responsibility; stakeholder expectations of “new practices” across mining and minerals value chains are high; and the tense global context and visible limitations of a growth model breaching planetary boundaries require “new governance approaches”.

Despite the sense of urgency and noise, it’s worth asking ourselves, as we did to kick off this conference, whether these approaches result in the reorganisation of value chains and improvement of responsibility across operations, linkages and borders. According to the Bank for International Settlements, global value chains are not diversifying but rather lengthening; funding for mining and mineral operations remains very constrained and the sector is not growing as necessary to rise to the challenges of decarbonisation and digitalisation; the global rush to duplicate processing capacity could have highly detrimental effect on responsible sourcing by heightening competition for feed. Not only are we not addressing today’s issues effectively, we may be creating or amplifying tomorrow’s.

As we come to a time of action and outcomes, we acknowledge the internal challenges (skills and innovation challenges, limited growth, increasing operational complexity) and external tensions (contradictory societal expectations, planetary boundaries) weighing on mining and minerals, whilst giving ourselves permission to reimagine these value chains and the operations and linkages they encompass for more responsible and resilient mineral production and consumption.

Rethinking the role and value of mineral activity in its economic, industrial, social and environmental ecosystem is precisely what Designing Sustainable Prosperity is all about. Doris Hiam-Galvez, PhD discussed how we can unlock the potential of resource-rich regions by integrating economic diversification, social well-being and environmental sustainability through a multidisciplinary, multi-stakeholder approach to co-create resilient regions. This echoed principles discussed by Jodi-Ann Jue Xuan Wang for investors and financiers to enable a just transition in and through the extractives sector, including the following essential recommendations:

Clarify and strengthen institutional investors’ strategy around transitioning out of coal and into energy transition minerals, including in transition planning

Support responsible mining standards with consistent tools and methodologies that can be integrated into existing sector-specific reporting frameworks

Engage in robust dialogue with a variety of stakeholders in an iterative, continuous, and patient process

Operationalise an intergenerational “shared inheritance” paradigm for resource management while leveraging extractions for broader economic development

Aside from better designing their impact and linkages, mining and mineral operations themselves are being revolutionised ?at all levels of the value chains. STEPHEN DESPOSITO discussed the work of Regeneration, a B-Corp start-up that produces biodiversity, community and climate-positive minerals for the energy transition, green tech and sustainable brands through remining, reprocessing, and restoration: few industries are as old as mining, and dealing with accumulated legacy of mineral operations can be an opportunity, rather than the liability burden to which it is mostly associated. At the other end of the mining industry spectrum, Terry Garde discussed the necessity to change both organisational or societal frameworks, and individual expectations and mindsets, to improve resilience, responsibility and risk in artisanal gold mining. In both cases the conservatism of mining and mineral finance, and resistance to change across the sector, were underlined as key hurdles.

Outsiders with no power to create institutional change, can still be agents of small, low risk changes, demonstrating improved health, safety and environmental practices that are sustainable without major restructuring of the miners’ environment. Once motivated the miners will want to be more competent in the use of methods and equipment, to own and operate appropriate technology. They also need faith in a bigger picture, beyond their hand-to-mouth existence, beyond the debilitating culture that so often surrounds them.

Resistance to change is precisely what Andy Reynolds tackled in his masterful discussion of the power and promise of mental models in a changing world. Andy reminded us that without challenge, mental models come to be seen as immutable laws of nature - especially if this makes it an easier sell for leaders seeking "alignment" - and even become part of our identity as individuals: in such cases, being invited to adopt an alternative model can be experienced as a threat to ones identity and sense of belonging... Mining and minerals is perhaps ill-equipped to deal with change, yet at the heart of one of the largest and most complex challenges that mankind has ever faced: responsible raw materials.

Delivering on the transition will depend on our capacity to overcome systemic resistance to innovate, redesign business and economic models and reshape mining and minerals. See you on the edge of chaos.

Reporting by Ludivine Wouters