Jim Cooney is an advisor on responsible mining at Metals for Humanity and a thought leader on social responsibility and sustainability in the natural resources sector. During his 30 years in the mining industry, Jim worked on projects in Canada and in many countries of the developing world. He played a major role in the Mining Minerals and Sustainable Development (MMSD) project from 1998 to 2002, which created a new framework for understanding and advancing corporate social responsibility in the global mining industry.
I spoke with Jim recently about the growing importance of corporate social responsibility in mining.
Ingrid: You spent more than 30 years in leadership positions in the mining industry and coined the term “social licence to operate”. What prompted you to focus on corporate social responsibility and more responsible mining practices?
Jim: I suppose I could say that my motivation was two-fold. In my role within Placer Dome, I was responsible for managing the social and political risk that faced the company’s projects in less developed areas of the world, where most of our mines were located. From my perspective, it was in the company’s own best interest to take a long-term view of the security of its operations in the context of evolving attitudes by national governments and by local communities with respect to their economic, environmental, and social impacts. Thus, corporate social responsibility was a risk management strategy intended to sustain the acceptance, if not the support, of communities and governments over the long term.
However, I also had a personal motivation. Ever since the time when I first visited developing countries, in my early twenties, I have been deeply concerned by the distressing social, environmental, economic and governance conditions that afflict most people in those countries. I have long felt a desire to make my contribution towards improvements in their lives. I suppose that my fundamental motivation at a personal level was a concern for social justice.
Over time, I came to believe that the company I worked for and the mining industry more broadly had the potential to contribute to the advancement of social justice in the vicinities and countries where it operated. But a business corporation could not proclaim social justice to be its mission. We needed to use terms more acceptable to corporate parlance such as “corporate social responsibility (CSR)”, “social license”, and “sustainability”. However, even those concepts initially had their opponents within the industry who thought that any corporate objective other than maximizing shareholder value went beyond the proper role of a business corporation.
Ingrid: Have you noticed promising progress in terms of mining companies delivering social good to the surrounding communities where they operate? Please provide an example of two.
Jim: During the past quarter century, the mining industry has made enormous progress through voluntary initiatives to implement environmental safeguards, community development strategies, and improved governance practices. As an example, consider the Towards Sustainable Mining (TSM) protocols of the Mining Association of Canada (MAC), which have been adopted in several other countries. TSM establishes stretch targets for mining companies related to Indigenous and community relationships, tailings management, biodiversity conservation, climate change, water stewardship, safety and health, mine closure, and other issues. Member companies are required to have independent external panels to provide ongoing advice on their social and environmental practices and to provide annual assessments of their performance. These TSM assessments by MAC members, as well as the reports by member companies of the International Council on Mining and Metals, provide many examples of beneficial relationships between leading mining companies and local communities.
However, despite this progress, the voluntary initiatives of leading mining companies have not proven adequate to prevent instances of community conflicts, tailings dam failures, and corruption in company relations with governments in many countries. Not all mining companies adhere to the high standards set by the leaders. Not surprisingly, institutions with significant leverage on mining companies, such as investors, banks and governments, are starting to impose stricter environmental, social and governance (ESG) standards on the industry.
Ingrid: What more can mining companies do from environmental and social perspectives?
Jim: With respect to voluntary initiatives that impose accountability on corporate social, environmental and governance practices, the industry is approaching the outer limits of what is possible, though there will always be room for refinements. The future will involve strict ESG standards imposed on companies by shareholder groups, financial institutions, and most especially governments. Initially, these standards will address such matters as greenhouse gas reduction, Indigenous community consent, and mandatory membership on boards of directors of representatives of stakeholders other than investors, such as communities and environmental advocates.
The industry needs to work to ensure that this evolution of externally imposed environmental and social requirements and new forms of corporate governance proceed in a manner that builds on and does not undermine its voluntary initiatives. The risk is that the vision, creativity, energy, and pride associated with voluntary initiatives to address pressing concerns in the field will be replaced by the forced compliance with external performance standards or, at the board level, by submission to external public priorities.
The future also holds another CSR challenge. Traditionally, mining companies produce metals and minerals that are regarded as generic commodities sold into the global market. Downstream stewardship of the industry’s products is likely to emerge as the next major ESG challenge that will require a creative industry response. Life cycle analysis of the total impact of metals and minerals will require new forms of impact measurement, transparency, reporting and accountability. The mining industry will need to give much more attention to the end use and disposal of its products. The industry will also need to become more involved in research and development of new applications of certain (perhaps all) metals and minerals.
Ingrid: Why did you become involved with Metals for Humanity?
Jim: I have been an informal advisor ever since you decided that the mining industry might be an area which could benefit from your knowledge and expertise as an anthropologist. Our consultations continued while you worked as an advisor to silver mining companies in Mexico with a particular interest in their relationships with local communities. This evolved to a focus on water quality in those communities as a priority public concern, which led to a consideration of the effect of silver on water quality, and consequently on individual and community health.
Ingrid: What excites you most about our vision at Metals for Humanity?
Jim: From my perspective, Metals for Humanity is an initiative at the cutting edge of the future of corporate social responsibility in the mining industry. It is addressing the downstream stewardship of a mining company’s product and engaging in research of new applications of silver and other metals, with a particular emphasis on the health and well-being of individuals and the planet.