Navigating political and regulatory changes
Managing political and regulatory uncertainty remains a significant challenge for the mining industry globally. A complex interplay between political, social and economic factors, and uncertainty, leads to trust deficits between stakeholders, hampers our ability to plan for long-term growth, and at times can threaten business continuity in a jurisdiction.
Considering the changes in the global landscape, the mining industry is increasingly expected to play a constructive and developmental role in economic, social, environmental and governance issues. These increasing demands coupled with regulatory uncertainty drive perceptions of escalating risk. This is invariably associated with reduced investment appetite and reduced industry and Company valuations.
With the convergence between formal mining licencing requirements and the growing importance of the social licence to operate, a prerequisite for business continuity is ensuring that trust is restored in the mining sector and strengthened through the industry’s actions.
We are committed to reframing the transactional and sometimes adversarial relationships between the Company, local communities and government authorities, as a transformational one which is underpinned by mutual benefit, integrity and transparency. It is in this way that we can promote shared value between our operations and all stakeholders, particularly host communities.
Navigating political and regulatory uncertainty is an issue that must be proactively managed. Our approach is underpinned by the need to build trust across the stakeholder groups and continued demonstration of good citizenship by the Company.
Constant constructive engagement with multiple stakeholders is key. We continue to work with community leaders, national and local government and civil society organisations. We also support government-supported initiatives to formalise ASM in Guinea, Tanzania, Ghana and Colombia.
We are guided by the work of other intergovernmental organisations such as the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development and the Organisation for Economic Co-operation and Development (OECD).
Progress in 2022
The global economic downturn and the war between Russia and Ukraine remains a risk, with escalating costs for the business and society at large. This is creating potential for economic, social, and subsequent political risks in our jurisdictions as prices for fuel and staple goods continue to increase. It also threatens the ability of the global community and individual member states to meet the UN SDGs by 2030.
West Africa is also experiencing significant political turmoil with a series of coups d’etat across the region, including in Guinea, Mali and Burkina Faso, among others.
The Economic Community of West African States (ECOWAS) has imposed sanctions on the President of Guinea and his close allies pending a timetable for a return to democratic elections and civilian rule. Political instability in the region generally has resulted in a number of challenges, including at our Siguiri mine amid an influx of people from elsewhere in the country and from neighbouring countries, to the province of Upper Guinea.
This is exacerbated by international isolation of the country because of sanctions, endemic poverty and joblessness in the local and wider community. Regional migration has increased ASM and illegal mining activity, slowed the delivery of economic and social development projects, and increased demands for higher local benefit and employment from the mine.
In West Africa, a deteriorating economic environment is fueling inflation and higher levels of unemployment. This has led to an increasing call for employment of local community members and a rise in artisanal mining. Both issues are already a focus for us.
In Colombia and Brazil, we have seen changes of government, which may result in changed business environments. We continue to watch this closely.
We will continue to engage with multiple parties in the regions in which we operate. Only through meaningful dialogue can we maintain our social licence to operate.
A presidential election will take place in the DRC in 2023 while presidential and parliamentary elections are scheduled in Ghana in 2024 and in Tanzania in 2025.
We continue to work with community leaders, national and local governments, and civil society organisations