Our climate is changing, and this presents both risks and opportunities for the mining and metals sector. But building climate resilience doesn’t have to mean reinventing the wheel.
Around the world, we are already experiencing some of the impacts of climate-related change. These include more frequent and extreme weather and climate events, along with gradual shifts in other climate-related factors, such as rainfall patterns, sea levels, sea ice and glacial retreat.
Incorporating experiences and insights from ICMM members and other experts, this report provides an overview of how a changing climate could impact the mining and metals sector, identiﬁ es ways that companies can integrate climate considerations into existing risk management processes and sets out a step-wise process for building climate resilience.
Key issues for the mining and metals sector
A changing climate will affect the mining and metals sector in various ways, both directly and indirectly. Extreme weather events and longer-term shifts in climate patterns have the potential to damage ﬁ xed assets and disrupt supply chains. Key areas of concern for ICMM members are water management, the performance of facilities with long lifespans where the design criteria may include certain climate-related assumptions (eg rainfall) and how climate change may impact closure and post-closure. Left unmanaged, these climate-related impacts may weaken a company’s balance sheet as well as its social licence to operate.
Climate change adaptation seeks to lower the risks and exploit opportunities resulting from the changes in our weather and climate. For the mining and metals sector, building operational resilience to physical climate change depends on a company’s ability to adapt to changes, anticipate what might happen next and absorb weather and climate-related shocks when they happen.
Climate adaptation also presents opportunities for the mining and metals sector. Reducing exposure to climate-related risks can reduce costs, preserve or enhance revenues, improve stakeholder relationships and help identify new business opportunities.
Building resilience doesn’t mean reinventing the wheel. The mining and metals industry has always responded to the challenges of working in varied physical environments, and many companies already have approaches, tools, data, resources and people in place to identify and manage related risks and opportunities.
Mining and metals companies are well advised to integrate climate change drivers within existing risk management and planning procedures and identify the ‘hooks’ for climate risk and resilience within existing activities and across the entire asset life cycle.
Climate risk and business resilience cuts across virtually all components of the mining system and business units. For a company to develop a comprehensive picture of the key climate-related risks and opportunities across the mining system, multi-disciplinary teams are needed, as well as capacity building and training of staff.
Companies are also well advised to involve external stakeholders – particularly host communities – in discussions about how to build resilience and manage climate risk. This is not only important for relationship building but will also help avoid ‘maladaptation’, whereby the adaptation actions of one group can have negative consequences for others.
Some companies’ increasingly modular approach to project design can be useful when facing multiple climate futures. And new technology – such as the use of spatial data, increased automation/remote operation and artiﬁ cial intelligence – can also offer signiﬁ cant climate resilience co-beneﬁ ts, helping manage climate risk while also lowering costs or improving health and safety at operating sites.
A step-wise process for building climate resilience
The step-wise process above (Figure A) aims to help members identify climate risks and opportunities. Recognising that each company is on their own journey to climate resilience, the seven steps outlined suggest ways in which members could develop a plan to adapt to climate-related challenges. In particular, the step-wise process emphasises the need to use observed and predicted climate data and scenarios to understand both current and potential future risks, and using mining and metal companies’ well-established risk management procedures and systems.
Climate change is a complex issue. But this isn’t a reason for inaction. And by building climate resilience today, ICMM members can reap rewards tomorrow – limiting future liabilities, safeguarding business continuity, making prudent investments and ensuring the sustainability of communities and ecosystems.