The most valuable commodity is trust — Keynote speech to BMO Global Metals, Mining & Critical Minerals Conference
It’s always a privilege to open this conference but after what I’m about to say, you might think I’ve lost my marbles and never invite me back.
Rohitesh Dhawan, President and CEO, ICMM (as written rather than as delivered)
For a conference all about physical commodities, I am going to talk about a commodity more valuable than all the money in this room. Relax gold folks, it’s not bitcoin! It's a commodity so rare that people spend their lifetimes searching for it and some may never find it. A commodity that in fact, can’t even be mined — it can only be grown.
I’m talking about trust. And I’m talking about trust in all its forms: between us as the industry and you as investors to deploy your capital responsibly; between us and the regulators who give us the legal right to operate; and, perhaps most critically, between us and the local communities who give us our social license to operate. Without trust, none of these relationships are sustainable.
When it comes to the current state of trust in the mining industry, I have good news and bad news.
Let’s go with the bad news first. Trust in our industry is at an all-time low. That is neither impressionistic nor my personal opinion — it’s what the data shows us. GlobeScan, the global polling and analysis firm, has been collecting data in 31 countries since 2001 and measuring the public’s trust in different industries. When asked the question to what extent to do you see these industries fulfilling their responsibilities to society, mining comes in at the very bottom. Rock bottom, one might say. Below oil and gas.
And it gets worse. Last year, at a time when the world finally started to recognise how critical our products are to the world’s most pressing sustainable development challenges, our score was the lowest it has been since records began.
Let’s go with the bad news first. Trust in our industry is at an all-time low. That is neither impressionistic nor my personal opinion — it’s what the data shows us. GlobeScan, the global polling and analysis firm, has been collecting data in 31 countries since 2001 and measuring the public’s trust in different industries.
We can all feel the impact of this lack of trust. The undervaluation and underrating of our sector is something we are all painfully aware of.
When asked the question to what extent to do you see these industries fulfilling their responsibilities to society, mining comes in at the very bottom. Rock bottom, one might say. Below oil and gas. And it gets worse. Last year, at a time when the world finally started to recognise how critical our products are to the world’s most pressing sustainable development challenges, our score was the lowest it has been since records began.
We can all feel the impact of this lack of trust. The undervaluation and underrating of our sector is something we are all painfully aware of. The instances of company-community conflict even to the extent of blocking projects from going ahead are another manifestation of low trust that’s causing real harm to everyone. And a university in the UK recently banned mining companies from recruiting on campus on climate grounds.
So what’s going on here? The world knows more than ever that without metals and minerals, there’s no energy transition, no net zero world, and no sustainable development. Yet, trust in our industry is at an all-time low.
Some would say it’s that not enough people know about our importance yet, and we just need to keep telling our story. Perhaps, but that sounds a lot like when someone doesn’t speak your language, to simply speak louder. And isn’t that what we’ve been doing for the last 20 years? And if 20 years have produced not just no improvement in trust scores but an absolute decline, do we really think the answer is to do more of the same?
You see, I have a different view of why understanding is going up but trust is going down. It’s because for a long time we thought we faced one deficit when in fact we face two. The twin deficits are — a deficit of understanding and of trust. Many in society do not understand what we do and why it matters, and this combined with the legacy of accidents and disasters in the past and present mean that society by and large does not trust our industry.
We have done a good job of acknowledging the understanding deficit and done a lot in the last 20 years to address it. The proof of our success lies in the critical mineral strategies that every major government has now developed. A few years ago, it would have been impossible to imagine the presidents and prime ministers of G7 countries talking about the importance of our sector and the commodities we produce, but yet that’s where we are, and that’s only growing.
But we have not swallowed hard on the trust deficit, and as a result not done enough to address it. And in doing so, potentially allowed our actions or inactions to shrink what trust people may have had in the industry.
Perhaps it was our collective assumption that understanding would lead to trust. It turns out that the understanding isn’t the on-ramp to the highway of trust that we thought it was. But instead that understanding and trust are like two lanes on a highway — running in parallel, bending and shaping to each other.
And so here’s where the good news comes in. We have come this far with our trust tank running on empty. Imagine how far and fast we could go if we added some fuel to it?
And so here’s where the good news comes in. We have come this far with our trust tank running on empty. Imagine how far and fast we could go if we added some fuel to it? We now have some good examples of how trust can be built, so let me tell you about some of those, and let’s see if we can draw the lessons from why those worked and how we might do things differently in future.
The Global Industry Standard on Tailings Management is now widely accepted by all parts of society, even the most ardent civil society groups as good practice for managing tailings safely. It is without doubt a technically sound and robust standard. But that’s not what seems to have given it the high trust dividend that it enjoys. Apart from the substance of the standard, the reason it is so well accepted appears to be that it wasn’t developed by the industry alone, but rather as a partnership of equals between ICMM representing the industry, PRI representing investors and UNEP representing civil society. Don’t get me wrong, it was by no means easy to work as three equals and took a huge amount of time and effort in relationship building, but isn’t that true of all meaningful human relationships? And the result is that a standard with all three logos on it is so much more trusted than if the exactly the same standard had just the ICMM logo on it.
Let me give you another example, this time from the world of decarbonisation. In 2021, ICMM was the first major group of companies in any heavy industry to commit to achieving net zero scope 1 and 2 emissions by 2050 or sooner in line with the Paris agreement. Many of our members are the leading developers of renewable energy in the world and as a result, are lowering their scope 2 emissions faster than anyone imagined. But we know that scope 1 emissions, the majority of which result from the use of diesel in mining vehicles, are stubbornly hard. It’s not that our companies don’t want to buy hydrogen or electric vehicles — it’s that until recently the technology wasn’t available at scale. So we got together a few years ago as the full set of ICMM companies representing one third of the industry, with 19 OEMs to jointly short circuit the development and production cycle for zero emission trucks. People said it couldn’t be done — they thought OEMs wouldn’t be able to trust each other as competitors, and the same with mining companies. We found a way to manage those competitive dynamics and the result today is that zero emission mining vehicles are expected to be available at scale by 2027, which is a full 13 years shaved off the expected date of 2040; given when we started this programme which is known as the Innovation for Cleaner, Safer Vehicles initiative.
In addition to these collective examples under the ICMM banner, many of the CEOs you’ll hear from could give you examples from their own companies of how they have built trust — and crucially, the painful experiences of when trust has been lost. But I’ve come to realise three features of what it takes to build enduring trust, which I hope serve as a blueprint for how we can build greater trust in our industry:
- First, trust is a supply side issue, not a demand side issue. What I mean by that, is that trust can’t be built solely by convincing people that they can’t live without our product. At best, that gets us to acceptance, and we should work to improve the understanding deficit as I mentioned earlier. But we need to put greater emphasis when we engage with society on the supply side i.e. how we produce what is essential to life and the energy transition, how we manage risks, and how we behave when things go wrong as they sadly inevitably do given the risks inherent in our business. Most importantly, it’s not just that we have these discussions with our stakeholders, but it’s how we show up to them that really determines whether we build trust or not — and this is where we are called upon to act with empathy, humility, active listening and mutual respect.
- The second thing about trust building is that it is a team sport. People don’t form an impression about a company and what it does independent of their view of the sector and the business in which it operates. In this case, rising tides truly do lift all boats. It would be a losing strategy if we chose as individual companies or even as just the group of 26 self-identifying leading companies in ICMM to do the right thing, and do little to influence the approximately 10,000 or more 'known' mining operations globally and potentially hundreds of thousands more that are 'unknown'. Consider that of the approximately 5,000 current energy transition mineral projects globally, half are on or near indigenous land spread around the world. If we don’t collectively strengthen mechanisms where the rights and interests of Indigenous Peoples are protected and society has trust in those mechanisms, we will all struggle to develop our projects and the actions of any one will affect us all.
- The final thing about trust building today is that it recognises that the world has moved on. Society’s relationship with business has shifted; I don’t here want to get into a culture war about wokeness and ESG! What I simply want to recognise is that on any issue, society’s expectations of companies and the impact they have on society has shifted from a world of ‘tell me’ what you are doing, to ‘show me’ what impact you are having, to now ‘involve me’ in your work. We need to collectively change our mindset with this changing time. In a tell me or show me world, it was fine to consult stakeholders at arm’s length and then do whatever we think is best anyway. In the involve me world we find that co-creating what we do is the only way to build trust. Doing so is messy, difficult and risky — but those all sound like things we deal with as miners every day, so I know we can do this if we are willing to meet this moment.
So with that, I conclude and ask you that as you consider the various mined commodities in the sessions and discussions over the next three days, always keep in mind the most precious commodity of them all — trust.