The responsible investment approach taken by Ethore SA in the mining sector aims to provide analysis and relevant advices to enhance investment decisions in companies that have ethical and responsible development approach and act in a proactive way in regards of sustainability aspects.
The responsibility of an investment in mining stocks may have a significant impact on the adoption of best practices and standards. We know that the mining sector is marred by severe accidents due to risk management negligence, to unsatisfactory working conditions or inadequate technical procedures. This state of business is unsustainable and we can participate to its improvement.
The raw materials extracted by mining companies feed a growing world population. The dependence on new materials and other technologies go hand in hand with the increase in purchasing power of the middle class. These extracted materials currently supporting about 45% of economic activity in the world. In addition, the modern industry requires rare and minor metals, whose concentrates’ specificities must meet very high quality standards imposed by OEM's (Original Equipment Manufacturers). For some of these metals, the future will go through the verticalization of the supply chain.
It is no longer sufficient for mining companies to offset their impacts by purely monetary compensation, or build hospitals and schools without considering the ‘after-mine’. Today, we must do things differently and in a more integrated way with existing NGOs or indigenous sustainable projects. Some mining companies have a narrow focus and short-term plans and they do not yet fully consider the impact of the legacy they will generate.
Metals are part of our modern lives and we must think sustainability through the process of circular economy.
Today, Industrial world depends on metals and for most of them their life cycle is very limited. There is a lot to do, but improvements have started in :
- optimized mining extraction and recovery
- more skilled and CSR orientated management
- mining automation and electrification
- efficient tailings'retreatment
- low-risk chemical extraction process,
- smart use of metals in materials
- urban mining and recycling
Thus we believe the mining sector is evolving under some positive influences coming form OEM's supply chain transparency, ESG (formerly CSR) reporting initiatives, Conferences of the Parties (COP), influencial fund managers, and responsible investors.