More than three quarters of the world’s biggest miners have pledged net zero, but a lack of clear reporting guidelines and the right leaders to hit their targets are areas of concern.
More than three-quarters of the world’s biggest mining companies have pledged net zero, but a lack of clear reporting guidelines and the right leaders to hit their targets are areas of concern.
That’s according to a new ‘sustainability on the horizon’ report from KPMG, which surveyed 322 global metals and mining executives to gauge sentiment on challenges facing the sector.
It follows KPMG’s global mining outlook earlier this year, which revealed environmental risk had displaced commodity prices as the leading area of concern for mining execs.
Although the majority of big miners have net-zero goals in place, setting the criteria for, and reaching environmental, social and governance targets remains front of mind.
“Notably, 29 per cent of the 322 global mining executives surveyed said they planned to achieve a goal of net zero emissions by 2025, whilst a further 40 per cent said by 2023,” KPMG global mining leader Trevor Hart said.
“A total of 87 per cent of the miners surveyed said they will have delivered net zero emissions by 2035.”
Inconsistent or absent government rules about ESG reporting was the main challenge companies said they faced in achieving ESG objectives, according to KPMG’s findings.
KPMG international global head of metals Ugo Platania said the sector was in dire need of consistent reporting standards.
“The sector is increasingly and consistently setting very ambitious goals related to net zero. This should be lauded and encouraged,” he said.
“We are, however, in dire need of a set of common measures and metrics to help ensure that all parties not only have a common understanding of the progress that has been made, but also that the investment required, through wider market participation, becomes sustainable over time.”
KPMG national leader decarbonisation transformation Cle-Anne Gabriel observed a similar sentiment.
“Executives say the most effective measures that will help their companies meet net zero targets are, first, to ensure their company communicates clearly and fully to stakeholders and, second, to see to it that net zero objectives are incorporated into overall corporate strategy,” Dr Gabriel said.
Mr Hart said it was difficult for stakeholders and companies to get some level of consistency and assurance in terms of reporting standards, but that different frameworks were emerging.
“Capital markets need them, stakeholders need them but more importantly organisations that have actually got the job of delivering need them too,” he said.
Poor execution and lack of labour and financial resources were close behind, with a lack of leadership in terms of ESG strategy and a lack of leadership from a C-suite level concerns in tow.
Mr Hart said leadership in that space was evolving.
“On climate, a clear path isn’t always easy for everybody… there’s technology a requirement, there’s capital investment requirements,” he said.
“To some degree I’m not surprised that it’s not crystal clear for respondents of the survey of getting from here to there by 2035, and that manifests itself in a view on leadership.”
Mr Hart said C-suite executives were likely the ones to lead ESG efforts, while the heavy lifting would likely be delivered by an organisation’s culture.
