Maintaining positive community relations is a growing challenge for mining companies in Australia/Oceania - with many avoiding investments in ‘no-go' zones in the region, new research from Mining Journal Intelligence (MJI) shows.
Community relations/social licence is a top priority in the mining sector globally and was chosen as the theme of MJI's Global Leadership 2023 report, published this week.
In the Global Leadership Survey - a key element of the report - MJI asked whether social licence or community relations challenges had resulted in ‘no-go' zones which mining companies and investors would avoid.
While the majority (58.8%) of the survey's 228 participants said no - that there aren't areas they would shun due to community relations concerns - 79 (41.1%) said yes (figures among Australia-based respondents - who made up 50.9% of the total - were more evenly matched, with 56.1% saying no and 43.9% yes).
Regional picture
Those who said yes were asked to specify social licence ‘no-go' zones - with many highlighting jurisdictions in Australia/Oceania as places they would shun due to community relations concerns.
The region, or parts of it, were mentioned by 18 respondents, second only to Africa, with 23 mentions, and ahead of South America (17 mentions).
The former Soviet Union and Asia were both mentioned by seven respondents, followed by Central America (6), Canada (5), and the US and Europe with three each. One respondent mentioned the Middle East.
Hotspot countries
Australia was also joint top among the most mentioned countries that survey respondents would avoid.
Seven respondents singled out the country or parts of it as a ‘no-go' zones due to community concerns, putting it neck and neck with Russia.
South Africa and the DRC - the world's highest risk jurisdiction in our World Risk Report 2022 - tied for joint third place, with five mentions each, with Canada (or parts of it) and Peru each mentioned four times.
There were three mentions for the US and Papua New Guinea, with two each for Indonesia and Argentina. Eleven countries were mentioned once, including New Zealand, which the respondent described as "very anti-mining".
States and territories
Among Australia's states and territories, Victoria received the highest number of mentions as a social ‘no-go' zone at four, followed by Tasmania, with three, and New South Wales, with two.
Queensland and the Northern Territory were each mentioned once.
Rising challenges
The Global Leadership Report 2023 also revealed that around four-fifths (79.7%) of survey respondents felt that securing and maintaining a social licence had got harder over the past five years - with a slightly larger majority (82.2%) expecting challenges to grow further over the coming half-decade.
Among Australia-based respondents, the figures were higher, at 83.7% and 88.8%, respectively.
The Global Leadership Survey forms one of two main elements of the Global Leadership Report 2023, along with interviews with senior executives of 23 larger mining companies, with aggregate market caps totalling more than US$350 billion, on the theme of social licence.
While only a handful of the CEOs interviewed stated that community relations had got harder, most said the situation had become more complex, largely due to social trends, with people much more likely to demand more benefits from the mining industry and less tolerant of negative consequences.
"We wouldn't say that it [social licence] is more difficult, but rather the expectation on companies to act responsibly, ethically and in the best interest of future generations is growing," Pilbara Minerals managing director and CEO, Dale Henderson, said in the report.
Other themes under discussion in the report include the effect of increasing automation on community relations, increasing spending on social investments in host communities, and top tools and strategies for keeping communities onside.
The Global Leadership Survey 2023 is available here. The report is free for Premium subscribers and can be purchased as a standalone report.
