Created by the World Economic Forum in 2010, the Responsible Mineral Development Initiative (RMDI) began with worldwide consultation and analysis aimed at identifying the key challenges around responsible mineral development. Phase two, in 2011, aimed to develop practical responses to these challenges. It established that there was no single ‘silver bullet’ solution, instead identifying six building blocks for progress.
The third phase, through 2012, focused on “a shared understanding of the benefits and costs of mineral development” and “collaborative processes for stakeholder engagement” using a multistakeholder approach to develop a better understanding of different stakeholder needs, expectations and priorities. To facilitate this, a ‘tool’ was developed outlining seven dimensions which drive value creation for governments, local communities and mining companies.
RMDI III (Mineral Value Management) was exceptionally well received by all stakeholder groups. In Chile and Peru for example, national roundtables were established to formalise a dialogue between all stakeholder groups around the issues identified in the respective country. Similar roundtables are planned to take place in Guinea and Mongolia throughout the year in addition to continued strategic dialogues with other key players in this space, such as the world Bank, regional development banks, the UN Economic Commission for Africa (UNECA) and bilateral donors. This page introduces the key findings of the phase three report.
As global population growth, urbanization and industrialization continue, particularly in China and other emerging economies, the global demand for metals will continue to grow, making the ongoing development of new mining projects inevitable. These new projects increasingly occur in developing countries, where they have the potential to be a key driver of economic growth and poverty reduction.
Yet governments and local communities in these countries are increasingly questioning the value of mineral development within their borders. Heated policy debates about the proper allocation of costs and benefits, threats of resource nationalism, and violent confrontations over new projects are all on the rise. Trust among stakeholder groups is waning; platforms for respectful engagement and dialogue are in short supply; and the goal of a shared understanding regarding the potentially transformative benefits of mineral development remains elusive.
The importance of creating a responsible, sustainable approach to mineral development has never been clearer, as projects face mounting opposition from Conga in Peru to Oyu Tolgoi in Mongolia. While the role of mining in economic development is increasingly recognized, debate continues on how mining should be done, and a festering discontent shows the general lack of trust between stakeholders.
With this backdrop, the World Economic Forum introduces this third milestone report as part of its Responsible Mineral Development Initiative (RMDI). In its first phase in 2010, the RMDI identified the key challenges facing responsible mineral development. Building on this, the Initiative’s work in 2011 led to the identification of six building blocks that provide a constructive framework for the sector. The RMDI continues to provide a neutral, truly multistakeholder platform for the discussion and development of ideas capable of unlocking the potential socio-economic benefits of mining.
During 2012, the RMDI focused on “Mineral Value Management” (MVM), a tool it has developed for enhancing understanding of the drivers of value in mining. This Report lays out the foundation of Mineral Value Management. It outlines the insights gleaned from a global survey and workshops on using the tool with over 300 stakeholders across four continents. The Forum hopes that this tool and the findings of this report can trigger frank and open discussion on the issues that affect, unite and divide different stakeholders in the mining industry.
The creation of this report also involved extensive outreach and dialogue with members of the private sector, governments, the academic community, NGOs and multilateral organizations from around the world. The Forum is extremely grateful to the many stakeholders whose invaluable input and support for this global initiative made this report possible.
Mining is a key driver of global economic growth, capable of creating long-term positive impact on lives, societies and nations. Although it has the potential to transform the economic prospects of mineral-rich developing countries, governments and communities are increasingly questioning the role of this sector. Debates over the proper allocation of costs and benefits, growing resource nationalism and conflict over new projects reflect waning trust between stakeholders and lack of effective engagement mechanisms. This makes the World Economic Forum’s Responsible Mineral Development Initiative (RMDI) more relevant than ever.
The RMDI was established in 2010 to develop a better understanding of the challenges and complexities involved in making mineral development responsible and sustainable, and to identify and pilot potential solutions to address these. Phase I involved worldwide consultation and analysis to identify the key challenges. Phase II, started in 2011, aimed to develop practical responses to these challenges. While no “silver bullet” solution was identified, six building blocks for progress were laid out.
Phase III – the subject of this report – focused on two of the building blocks: a shared understanding of the benefits and costs of mineral development, and collaborative processes for stakeholder engagement, focusing on designing a multistakeholder approach to develop a better understanding of different groups’ needs, expectations and priorities.
This is important because disputes are more likely when stakeholders are poorly informed about each other’s perceptions and aspirations in relation to the costs and benefits of mining.
The RMDI was established to identify and provide guidance on the key challenges around responsible mining development. Phase I in 2010 included interviews with more than 250 stakeholders from 13 countries on their perceptions of these challenges. The objective was to understand what works and what does not, where discontent and frustration commonly arise, and where improvements are possible.
The main problems were identified as:
- Limited expertise and institutional capacity of governments, civil society and companies
- Insufficient stakeholder inclusion in decision-making processes
- Opaque negotiation and development processes
- Incomplete compliance, monitoring and dispute-resolution components
Phase II in 2011 developed a deeper understanding of the challenges and identified constructive, practical responses to them. Workshops in six continents underpinned further research and consultation. This phase showed that no single “silver bullet” solution to the challenges exists. Instead, six building blocks were identified that address common challenges and provide guidance on practical actions to take:
Each building block was supported by practical examples of good practice such as Alcoa’s creation of a local development council in Brazil; Rio Tinto’s publication of its tax and royalty payments in 28 countries; and Mongolia’s national dialogue platform. A survey found across-the board support for the building blocks, with particular enthusiasm for training and development, collaborative socio-economic studies and the establishment of effective dialogue platforms.
The Mineral Value Management Survey is part of the World Economic Forum's ongoing Responsible Mineral Development Initiative (RMDI) which is currently investigating drivers of value in the extractives sector for different stakeholders. The survey takes 15-20 minutes to complete and tests stakeholders' views of current value and areas of opportunity to increase value. It is available in English, French, Portuguese, Spanish and Mongolian.
Take the survey here: https://www.surveymonkey.com/s/TLH9Y9H
- Britt Banks*, Adjunct Professor, University of Colorado, USA (Chair)
- Arlin Hackman, Senior Conservation Advisor, WWF-Canada
- Gavin Hayman, Campaigns Director, Global Witness, United Kingdom
- Huguette Labelle*, Chair, Transparency International, Germany
- Kathryn McPhail, Director, Social & Economic Development, International Council on Mining and Metals, United Kingdom
- Kate Carmichael, Manager, Social & Economic Development, International Council on Mining and Metals, United Kingdom
- Richard O’Brien, President and Chief Executive Officer, Newmont Mining Corporation, USA
- Antonio A.M. Pedro*, Director, Sub-regional Office for Eastern Africa, United Nations Economic Commission for Africa, Rwanda
- Tsagaan Puntsag*, Chief of Staff, Office of the President of Mongolia
*Also a member of the Global Agenda Council on Responsible Mineral Resource Management