Community investments are a way mining companies can build strong relationships with local communities.
These investments drive the success of future operations and projects. In the survey conducted for the ESG Mining Company Index, social investment/community relations were recognised as a top priority for the industry.
Given the importance of community support, how are mining companies responding and is the community investment landscape changing?
In 2023, the ESG Mining Company Index reported, that out of the 50 companies assessed there was a combined community investment of US$2.70 billion, averaging about $51 million per company.
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Social investment falls
Social investment in the mining sector declined in 2023, falling to $2.55 from $3.49 billion in 2022. Figures are based on data from 41 companies for which spending data was found for each of the past three years.
This decrease was primarily due to a significant reduction in community support from Vale, which dropped from $1.61 billion in 2022 to $677.3 million in 2023 – an almost 60% decline.
This included $269 million of voluntary investment, institutional relations and operational impact management, and $277 million on obligations. The overall figure includes spending relating to Brumadinho in Brazil, where a tailings dam collapse killed about 270 people in 2019.
Norilsk Nickel achieves top ranking in community support spending
The ESG Mining Company Index identified Norilsk Nickel as the top performer in the social investment category, spending $343/t of copper equivalent. This was much higher than the runner up, Northam Platinum, which reported a spending of $130/t of copper equivalent.
Despite the nickel producer's contribution to social investment, the company also reported a decrease in spending in recent years. Their community investment contribution declined by 18.62% since 2021.
Ivanhoe Mines expands community investment initiatives
Ivanhoe Mines emerged as a notable exception to the social investment trend. The ESG Mining Company Index reported an increase of Ivanhoe's social contribution by more than 300% – from $13 million in 2021 to $39.3 million in 2023. This marked the largest increase in social spending among the companies analysed.
A significant portion of Ivanhoe's investment was allocated to skills development programs, engaging 1341 employees in various training initiatives. The aim of Ivanhoe's investments is to enhance local communities' prosperity and resilience, as stated in their 2023 report.
More about the ESG Mining Company Index
The inaugural ESG Mining Company Index covers more than 7000 data points, evaluates 61 of the world's largest mining companies through nine weighted indicators across six critical pillars: Carbon emissions, Water, Land disturbance, Safety, Diversity and Social investment.
To access the full report today click here and/or view the webinar on the index available here.
