o3 BLOG | Investing
ESG Investing and the Mining Sector
The emergence of the COVID-19 pandemic brought far-reaching consequences for businesses across all sectors, causing many to slow their operations and pivot to coping strategies. Socioeconomic disparity and inequality at work became more apparent as marginalized and vulnerable communities experienced higher rates of financial loss and health risk. The reality of a looming climate crisis is more apparent now than ever, and global leaders are stepping up to address a profound need to shift to a more sustainable economy. As global leaders plan the economy’s recovery, a new conversation surrounding environmental, social, and governance (ESG) is taking place within the mining sector. Metals and minerals will be needed to facilitate the rebuilding of the economy. Key industry players must take action to implement frameworks to assess sustainability and ethical mining practices and solutions to protect the planet without losing sight of business objectives.
What is ESG — The Three Pillars
The Environmental Pillar
The environmental pillar is often the first thing that comes to mind when the topic of ESG arises. This pillar focuses on climate change, maintaining biodiversity, waste management, water and resource use, and reducing the overall carbon footprint. There is a mutual financial benefit for companies, as minimizing energy expenditures, resource use, and packaging materials generally decreases a company’s overall spend.
The Social Pillar
The social pillar centres on human rights, ethical labour practices, employee health and safety, diversity and inclusion, wage equity, and fair taxation. On the business side, there is a need to emphasize the well-being of their workforce. Employers need to recognize workers as valuable company assets who should receive better maternity and paternity benefits, flexibility to support a work-life balance, and continual learning and development opportunities. To ensure a healthy relationship with surrounding communities, organizations should invest in local projects that foster community building and growth. The main goal of implementing a social pillar is to treat employees, stakeholders, and surrounding community members ethically and with respect.
The Governance or Economic Pillar
A vital part of the governance pillar is maintaining a profitable and sustainable business. And while most corporations place profit at the forefront in the ESG matrix, it cannot take precedent over the other two pillars. The governance pillar helps companies maintain realistic goals under the ESG matrix, leveraging involving risk management, compliance, and corporate operations to balance the objectives of the other pillars. Transparency is another component of the governance pillar to ensure that companies present investors with accurate and honest information.
The Impact of Sustainability
Ten years ago, investors and executives might have found adopting ESG practices difficult. However, many investors view ESG as a corporate advantage that will provide long-term value to the business. A commitment to ESG allows companies a newfound purpose that contributes to efficiency, sustainable scalability, increased shareholder benefits. The COVID-19 pandemic has shone a new light on the need for responsible and sustainable business practices. ESG within the mining sector is an investment that delivers steady returns.
Protecting the Planet While Improving Performance
Multiple studies conducted over the past five years suggest that companies implementing sustainability initiatives drive better financial performance due to innovation and improved risk management processes. Organizations with ESG strategies also had more downside protection in the event of an economic crisis. Companies that practice ESG appeared to have better operational performance, and sustainable company initiatives also positively influenced stock prices.
Sustainability is the Future of Investing
The mining sector was one of the first industries to commit to regular sustainability reporting through the International Council on Mining and Metals. In Canada, mining companies continue to take further steps to support ESG with the “Towards Sustainable Mining” (TSM) initiative. The initiative demands more involvement from industry leaders, making participation mandatory for all members. The TSM initiative requires companies to perform assessments at the facility level to ensure companies achieve sustainability at every function within an organization.
ESG advocacy is a driving force for positive change by fostering collaboration between companies, communities, and investors. By finding innovative solutions to take action against climate change, mining companies are better preparing themselves to counteract the potential environmental risks. As the mining sector gains further momentum ahead of other industries, more investors shift their attention to future-focused companies with clear sustainability plans.
Since our inception in the fall of 2019, O3 Mining has experienced tremendous growth, with our exploration campaigns exceeding all expectations. As we continue on our journey, we are constantly contributing to our ESG development strategy, finding better ways to serve our environment, our community, and create a more sustainable future for all. You can find the details of our latest ESG report here.
O3 Mining Proudly Achieves UL ECOLOGO® Certification for Mineral Exploration
We started the accreditation process on July 12, 2021, and On August 20th received UL 2723 ECOLOGO® Certification for Mineral Exploration Companies. We are proud to have received this certification as it further supports our commitment to sustainability and responsible mining practices.
We understand that the UL ECOLOGO® certification program for mineral exploration benefits not only our company but the surrounding communities and the mineral exploration industry as a whole. We are proud to use the UL ECOLOGO® mark for mineral exploration and are officially in UL’s sustainable product database, SPOT. We continue to promote this certification and its advantages, helping to make it a key objective in the mineral exploration sector.
The Future of Development
The responsible exploration and development of mineral resources is essential to maintaining sustainable mining practices. Which hold true to our principles, as they affect all parts of society, and we apply them in every one of our projects. For mineral exploration companies and mining companies like O3 Mining, ESG is a cornerstone of our business and adds long-term value for all of our shareholders.
Advantages of UL ECOLOGO® certification
For O3 Mining, the UL ECOLOGO® Certification for Mineral Exploration promotes a better work environment, motivates employees, improves our reputation as an employer, strengthens strategic planning, and helps to facilitate risk management. As studies tend to show, this certification can allow us to adapt to legislation changes that affect our industry.
Since obtaining certification, we have added specific information on our accomplishments surrounding ESG and how we plan to implement this certification moving forward.
Sources and information:
UL ECOLOGO® Certification for Mineral Exploration
QMEA’s Coaching Program:
Since our inception in the fall of 2019, O3 Mining has experienced tremendous growth, with our exploration campaigns exceeding all expectations. As we continue on our journey, we are constantly contributing to our ESG development strategy, finding better ways to serve our environment and community and create a more sustainable future for all. You can find the details of our latest ESG report here.
O3 Mining is a Canadian Junior Mining company that delivers superior returns to its shareholders and long-term benefits to its stakeholders. To learn more about our ongoing projects and investment opportunities, book an appointment with our executive team today.
To learn how O3 Mining can add long-term value to your portfolio, contact us today.
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