Mineral Resource Governance

Over the next three year we will increase our contribution to and engagement with the Extractives Industry Transparency Initiative (EITI) and other key partners including the Natural Resources Governance Initiative (NRGI) and the Intergovernmental Forum (IGF) to find opportunities to improve international norms. We will also be providing an institutional home for Committee for Mineral Reserves International Reporting Standard (CRIRSCO) to advance standards of reporting mineral deposit estimates and exploration progress.

Issue at a Glance

• When done responsibly, mining can play a truly transformational role in the social and economic development of host countries. As countries continue to set targets to enable the energy transition, demand for the critical minerals needed for clean energy technologies will grow. This only heightens the importance of transparent disclosure, and the continued push for good governance of mineral resource wealth.
• Natural resources including metals and minerals belong to a country’s citizens. Transforming these finite resources into economic growth and social development is best achieved through their responsible extraction within effective policy frameworks set by government. But resources published by the World Bank and NRGI (Natural Resource Governance Institute) show that governance of natural resources in many resource-rich countries is weak, poor, or failing. The private sector has a key role to play in ensuring that mining’s contribution is maximised.
• Through our Social and Economic Reporting Framework, ICMM members have committed to report against a set of eight core indicators including on workforce composition, pay equality, wage level, provision of training, country-by-country tax reporting, local procurement, education and skills support, and capacity and institution support. This data will supply the foundation for our members to report consistently on their contribution to social and economic development.
• ICMM company members also commit to disclose all mineral development contracts signed by themselves and host governments from 1 January 2021. This is an important way for citizens to find out what the mining company has committed to do, what taxes they are obliged to pay and when they should pay them. It allows the citizens of that country to hold both the company and their government to account for the decisions that have been made on their behalf.
• As responsible stewards of natural resources, our members accept that they have a moral imperative to contribute to social, economic, and institutional development. ICMM’s Mining Principles require members to proactively engage key stakeholders on sustainable development challenges and opportunities in an open and transparent manner, which includes publicly supporting the implementation of the Extractive Industries Transparency Initiative (EITI) by compiling all information on material payments, at the appropriate levels of government, by country and project.

Mining and Tax

• Corporate income taxes (CIT) and royalties are important indicators of economic contribution. The transparent disclosure of this data helps civil society to hold governments to account for revenues paid.
• As well as a useful indicator of mining’s contribution, tax is an important consideration for investment decisions behind the production of the materials needed for the energy transition. Consistent tax regimes and policies are therefore necessary to attract investment that contributes to job creation, competition, and growth. This is especially important as governments look to recover from the fiscal damage of Covid.
• Geopolitical, and social issues such as conflict, increases in the cost of living, and the urgency to decarbonise will mean that commodity prices remain uncertain. In the face of these challenges, governments will face increasing pressure to raise taxes to balance public finances.
• It is critical that any decisions that are taken on tax are informed by robust data. Transparent disclosure of tax payments remains an important way to inform the global debate around taxation of the mining sector as well as informing policy decisions.
• Many participants in the mining tax debate are global organisations that are active in several regions and across different sectors – including the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF), World Bank, International Monetary Fund (IMF), Organisation for Economic Co-operation and Development (OECD), and from civil society NRGI and Oxfam. It is critical for the industry to collaborate with these global organisations and local, in-country voices to effectively respond to global trends and issues.

Our Priorities