The mining sector in the face of the climate change

4th July 2018
-Gestion de fonds, IAM

Olivier Aeschlimann, Senior Financial Analyst - Fund Manager

In only a few years, climate change has moved from being considered as a marginal problem voiced by a minority of activists to a social phenomenon with major political and financial implications. The climate risks are now well documented: flooding, draughts, storms, rising ocean levels triggering migratory movements… Investors however do only start to grasp the full financial implications (risks and opportunities) of these changes. In this context, the mining sector faces two major challenges. First it has to convince investors that it is not part of the problem. Greenhouse gas will need to be reduced, responsible use of water resources will have to be demonstrated, renewable energy used and so preserve and restore the environment affected by mining operations. Second the mining sector has to prove that it is part of the solution, in particular by providing metals and minerals essential to the energy transition and decarbonisation of the economy. To be credible, these initiatives have to leave the simple ESG report and be fully integrated to the centre of the wealth creation strategy of mining groups.