采矿及金属行业2022年十大业务风险与机遇-44页_3mb

2022 Mining and Metals Sector Summary

Core Content

The mining and metals sector in 2022 faces a landscape where opportunities are expected to outweigh risks, driven by ongoing social disruption and increasing focus on sustainability. The sector is under pressure to align with environmental, social, and governance (ESG) standards, as investors and stakeholders demand greater transparency and accountability.

Top Risks and Opportunities

Top 3 Risks and Opportunities

1. Environment and Social

   • Environmental and social issues are seen as the number one risk and opportunity.
   • Miners must demonstrate their contribution to a sustainable future to access capital.

2. Decarbonization

   • Decarbonization is a major disrupter in the sector, now ranked second.
   • It requires integration into overall corporate strategy rather than being a separate initiative.
   • Companies that share their net-zero roadmap can gain investor confidence and competitive advantage.

3. License to Operate (LTO)

   • LTO has moved from the top spot to third place but remains a critical issue.
   • Miners that demonstrate societal value will strengthen stakeholder relationships and benefit from lower costs of capital and improved market value.

Key ESG Issues

Environmental and Social Scrutiny

• Investors are increasingly focused on biodiversity, social impact, and water management.
• The water-energy nexus is a key ESG issue, with water management being the second most scrutinized issue.
• Tailings dam safety is a growing concern, especially in light of recent failures and their impact on communities and the environment.

Human Rights and Supply Chains

• Transparent supply chains are essential to demonstrate human rights commitments.
• The Equator Principles (EP), particularly EP4, require human rights assessments before project funding is awarded.
• There is a rise in child labor and violence against women due to the pandemic, prompting the need for stronger supply chain oversight.

Circular Economy and Net Zero

Circular Economy Opportunities

• Mining and metals companies are facing risks but also opportunities through the circular economy.
• Recycling, renewables, and carbon-reduced products are areas of potential growth.
• Scope 3 emissions are particularly challenging but crucial for long-term sustainability.

Scope 1 and 2 Emissions

• Reducing scope 1 and 2 emissions is a priority, with renewable energy being the most cost-effective solution.
• Fleet electrification and zero-carbon fuel options are key steps in this process.
• Carbon capture and storage may be necessary to achieve net-zero targets, especially for processing and backup power.

ESG Reporting and Standards

ESG Reporting Challenges

• The alphabet soup of ESG standards is a challenge for miners.
• A move toward common ESG metrics is gaining traction, with the IFRS Foundation pushing for standardization.
• Shareholder accountability is expected to increase, with ESG performance linked to senior management pay.

Diversity and Inclusion

• Diversity and inclusion are becoming more important in the capital markets.
• Companies that embrace diverse and inclusive practices can improve retention, productivity, and overall performance.
• Millennials are more likely to choose jobs in companies with strong sustainability practices.

Geopolitical Risks

Geopolitical Trends

• Geopolitics is a growing risk, with resource nationalism on the rise.
• Trade wars and new governments are altering the strategic landscape for mining companies.
• Increased royalties and regional investment in critical minerals are expected as countries seek to boost self-reliance.

Actions Expected from Governments

• Re-emergence of resource nationalism is anticipated, with governments likely to increase royalties.
• Regional investment in critical minerals is expected to continue, possibly restricting foreign investment.
• Global minimum tax proposals may impact multinational mining operations.

Strategic Recommendations

Next Steps for Miners

• Identify key LTO issues that can drive or destroy value.
• Align with a stakeholder-driven agenda, moving beyond a narrow focus on shareholders.
• Measure with the right metrics, as ESG performance becomes a priority for CEOs.
• Build a strong brand by effectively communicating and reporting on value delivered to stakeholders.

Conclusion

The mining and metals sector is at a pivotal moment, where sustainability, ESG integration, and geopolitical shifts are reshaping the industry. Companies that proactively address these issues will be better positioned to secure long-term value, maintain their license to operate, and thrive in a rapidly evolving market.