ROBECO - Fri, 04/28/2023 - 15:09

Improving mining safety leads Q1 Active Ownership report

A successful engagement program has led to significant improvements in the impacts of mines, the Active Ownership Q1 report reveals.

  • Nine out of ten engagements in mining theme closed successfully
  • Update on laggards not aligning climate risks with Paris Agreement
  • Work continues on improving labor conditions in the post-Covid world

The team has just closed a three-year dialogue with ten companies in its ‘Lifecycle management of mining’ engagement theme that began in 2020. It targeted water risk management, tailings dams safety, and the issue of how to retire depleted assets. Some 90% of the engagements were closed successfully, a particularly high level of success given the complexity and risks of the mining industry.

Sylvia van Waveren reflects on the significant improvements in environmental management seen across the mining sector over the engagement. She discusses best practices when it comes to water management, tailings dam safety and asset retirement planning, as well as the next steps Robeco and its collaborative engagement partners will take to move to a sustainable mining sector by 2030.

As one theme closes, another high-profile theme continues. One and a half years after launching our ‘Acceleration to Paris’ enhanced engagements with the laggards on the climate front, Nick Spooner reflects on the legislative and geopolitical events that are pushing corporates to take another look at their climate-related risks and opportunities to meet the Paris Agreement.

Holding companies accountable

Insisting on good corporate governance and holding companies accountable for their wider societal impacts also remains important. Regulators around the globe including the US Securities and Exchange Commission are tightening their requirements for disclosure on ESG issues. Diana Trif takes us through some key developments in US corporate governance, explaining the relevance behind the introduction of universal proxy cards, new clawback rules and upcoming disclosures.

Covid may seem like a distant memory, but its legacy is still among us. Mid-way through our three-year engagements on ‘Labor practices in a post Covid-19 world’, Claire Ahlborn shares some of the positive steps and continued challenges that labor-intensive companies are facing when it comes to decent work. From misleading accounting standards to complex legislative realities, ensuring responsible labor practices continues to be a challenge even post-pandemic.

Embedding sustainability long term

“In times of geopolitical and economic uncertainty, shareholder advocacy is as important as ever, ensuring companies’ long-term focus on sustainability does not come at the cost of short-term financial volatility,” says Carola van Lamoen, Head of Sustainable Investing at Robeco. “The first quarter of 2023 continues to put companies to the test, as competing pressures showcase the importance of having sustainability embedded in one’s business model.”

“It’s been a busy three months for the Active Ownership team dealing with a number of high-profile engagement themes. To create a mining industry free from fatalities and environmental pollution, a systemic and long-term collaboration with the sector is needed. This prompted Robeco to join the ‘Mining 2030’ global investor initiative, working towards a consensus across the finance and corporate world for a reformed mining sector by the end of this decade.”

“Meanwhile, we reflect on our ‘Acceleration to Paris’ theme, putting pressure on some of our portfolios’ worst polluters to meet the Paris Agreement. While keeping the pressure high, we reflect on some of the largest achievements of these first 18 months, from companies strengthening net-zero emission targets, to cancelling upcoming thermal coal power projects.”

New regulatory requirements

“Reflective of the government actions taken on the climate side, regulators around the world have started tightening their requirements for ESG disclosure. From the introduction of pay versus performance disclosure requirements, putting a halt on inconsistent CEO pay-outs, to mandatory climate governance disclosures, the new rules from the SEC will force companies to review their practices and form the building blocks for a more sustainable economy.”

“And on the social side, we reflect on the last three years since Covid-19 was proclaimed a global pandemic. Our ‘Labor practices in a post Covid-19 world’ engagement theme aims to support companies in their recovery from the pandemic, building back stronger, with their core asset at the center of their business model: workers.”

“We are pleased with the progress made in the first quarter of 2023 and look forward to another year of meaningful engagement to help guide companies through our turbulent times.”

Read the Full Q1 Report Here


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