Environmental, Social, and Governance (ESG) is poised to take centre stage when the ‘who’s who’ of the mining and resources sector converge in Sydney for the International Mining and Resources Conference (IMARC) in November.
Australia has long been a leader in terms of the level of change and innovation being implemented across the mining industry.
Investors alike are particularly focused on companies with clearly defined decarbonisation policies across the entire mining value chain, taking holistic views that sustainability extends well beyond just environmental concerns.
The industry changes and adoption of ESG is being catapulted by the demands and expectations of stakeholders across the entire resources sector, helped along by the pandemic-driven adoption of new ways of working.
While ESG is characterised as a framework that helps stakeholders understand how a company manages their risks and opportunities related to the environment, global hurdles have somewhat slowed efforts.
despite the global challenges, Australian mining companies remain steadfast in their approaches to sustainability, supply chain, and geopolitical issues … making the country an even more attractive proposition for investment
Yet despite the global challenges, Australian mining companies in particular remain steadfast in their approaches to sustainability, supply chain, and geopolitical issues, which are making the country an even more attractive proposition for investment in the mining and resources sector.
Resources companies have started to gain confidence that investors will rally behind robust ESG credentials, and in turn, capital markets are now willing to invest into these opportunities, as long as they are well-defined.
Australia has a rich history of mining, with the sector being a major economic driver and employer, with a long-established mentality that responsible mining creates wealth and opportunity with minimal damage.
Ahead of IMARC next month, financial experts and investors are preparing to discuss the impact of these interwoven challenges and the opportunities that lie ahead for the sector.
According to SW Accountants and Advisors Partner Blayney Morgan – an energy and resources specialist at the firm – Russia’s actions in particular have highlighted the global susceptibility of relying on foreign resources. This has led to many countries to rethink the role of globalisation within their own economy, however domestic self-sufficiencies are not necessarily an achievable prospect.
Queen’s Road Capital Investment CEO Warren Gilman says there is no question that there is a global trend towards decarbonisation but necessity often trumps trends like what the market is currently seeing.
“And we’re seeing a short-term necessity for the re-investment in carbon-based energy forms around the world to fill what is hopefully a short-term requirement.”
Gilman says there is certainly a much greater awareness of the idea of the security of supply chains and domestic production due to the impacts of COVID, the invasion of Ukraine, and the polarisation of global politics generally.
“Countries have realised that you are putting your populace at heightened risk by not having a domestic supply chain and a domestic source of inputs, so there’s an increased realisation of that risk.
But the incentive is just not there to prioritise domestic resource security and governments have had other priorities. They’ve been all about efficiency and cost reduction, not about security, so I’m not sure that’s going to change.”
Australia appears to be providing the best investment opportunity as a reliable, increasingly sustainable market with incredible opportunities for growth, while domestic supply chains become more of a priority in other major regions such as the US.
“Australia is top of the heap. It’s in a wonderful, wonderful position”
Gilman adds: “Australia is top of the heap. It’s in a wonderful, wonderful position. Along with Canada the two countries are the best to invest in when it comes to mining.”
Morgan notes that Australia is an easy place to do business and has an environment where project valuations are high, with lower costs of capital, due to the country’s infrastructure, protective legal system, and well-trained workers.
IMARC is a forum where rich investment opportunities can be explored with mining heavyweights and exciting newcomers to the industry.
Morgan explains: “A key role of IMARC is to highlight challenges facing the sector, locally and globally, and provide a positive and productive forum where people can talk about them. Discussions started at IMARC often lead to positive solutions!”
IMARC is the only forum of its kind that uses enhanced and incredibly accurate networking technology to match delegates, allowing them to pinpoint new business and investment opportunities and start important conversations.
IMARC brings together more than 7,500 decision makers, mining leaders, policy makers, investors, commodity buyers, technical experts, innovators, and educators from more than 100 countries for three days of learning, deal-making and unparalleled networking. The conference is developed in collaboration with its founding partners the Victorian State Government of Australia, Austmine, the Australasian Institute of Mining and Metallurgy (AusIMM) and Mines and Money.
Write to Adam Orlando at Mining.com.au