Simona Ionas,
Senior Manager, External Communications
sionas@aviso.ca
416-770-8967
By Jamie Bonham, Head of Responsible Investing, NEI Investments
In the first Speech from the Throne after Confederation in 1867, the Government of Canada heralded the development of “the mineral wealth which abounds in the region of the North-West” as part of the newly born Government of Canada’s nation-building plan. They say that history doesn’t repeat, but it rhymes. The current government’s push to develop critical minerals projects in the interest of nation-building certainly rings familiar. Our 159 years of experience offer important lessons on how to proceed the right way.
Mining is the backbone of any modern economy and there are good reasons why our leaders are talking about the benefits for Canada in producing “critical minerals” such as copper, nickel, lithium, and rare earths. The economics of renewables and EVs are steadily improving, and it’s a good bet that demand for these technologies will continue to be stoked by global shocks to the conventional energy system, such as the war in Iran.
The International Energy Association projects that the demand for critical minerals is going to increase dramatically in the coming decades, with lithium demand alone projected to grow fivefold by 2040. The global appetite, paired with the growing awareness of these minerals’ strategic importance, suggests there’s something to the hype. Investors would be wise to take notice.
There’s something peculiar about our society’s relationship with mining. We think about mining as often as we think about the foundation of our house: hardly ever. Yet we enjoy the benefits and rely on it daily. A successful energy transition hinges on how well we meet this moment of demand, yet we don’t spend a lot of time talking about how we’ll actually do so.
Mining’s challenge isn’t exactly indifference. Many studies, including this one, show that a majority of Canadians recognize the importance of mining to the economy and are generally in favour of future development. Instead, mining has a trust issue. Those same Canadians who say they recognize mining’s importance also say they don’t trust the industry—or our governments—to mine responsibly.
Trust is a depleting global commodity these days but, even in the current environment, mining stands out, and not in a good way. Globescan’s annual survey on global public opinion puts mining dead last among all industries when it comes to the perception of how well it fulfills its responsibilities to society. Banks, pharmaceuticals and even AI companies all rank ahead of mining.
This lack of trust, whether deserved or not, is a genuine challenge for the industry. It impacts the industry’s social license to operate, its ability to get permits, and its ability to build partnerships with Indigenous communities. In essence, it impacts its ability to build. And that’s a problem for everybody because we all have a stake in the transition.
Reasons for this lack of trust aren’t hard to find. Mining is, by its very nature, an extractive endeavour that has visible environmental impacts on the landscape and a spotty record of cleaning up after itself. While mining can bring well-paying jobs to local communities, the benefits are not always shared equitably with those closest to the mines, who often experience unwelcome social impacts.
Indigenous communities have had a particularly fraught history with the industry. Sir John A. Macdonald’s inaugural address about exploiting the West’s mineral wealth was, in fact, an explicit call for colonization of Indigenous lands. So began a legacy of extracting natural resources at the expense of Indigenous rights—a legacy we have only recently started to address. Our next round of nation-building will need to do much better.
Which brings us to solutions. To build trust, the industry needs to embrace best practices in mining, increase transparency, engage meaningfully with affected communities, and build mutually beneficial relationships with Indigenous communities, based on a foundation of respect for Indigenous sovereignty. And it needs to be seen to be doing these things, as perception is everything when it comes to public trust.
This is exactly the problem the Initiative for Responsible Mining Assurance (IRMA) was built to solve. IRMA is a multi-stakeholder-governed, independently audited, best-practice standard for mining that holds transparency as a central tenet of its theory of change.
IRMA’s unique governance structure consists of six “houses” representing key stakeholders in the mining ecosystem: mining-affected communities, organized labour, NGOs, mining companies, downstream buyers, and finance. I currently serve as chair of the IRMA board in our capacity as a member of the finance house. Every house must be on board with every aspect of the standard. Is it easy? No. Is it worth it? Absolutely, because IRMA’s hard-won trust flows from the fact that all six houses can claim equal ownership of the standard.
When trust is at a premium, it’s not enough for a mining company to ask stakeholders to believe it is doing well, when their own experience leads them to different conclusions. That’s why IRMA’s standard requires independent verification and complete transparency on the results. That commitment to transparency inevitably means that a mine’s shortcomings will be exposed to scrutiny.
But IRMA is not about identifying perfect mines; it’s about creating real-world change. That means starting with an honest accounting of the challenges (and the successes), in a way that captures the perspectives and lived experiences of key stakeholders. Nobody should be surprised that a mine site has some, if not many, shortcomings relative to best practices, and we should encourage mining companies that commit to transparency. However, earning trust also requires a transparent and time-bound plan to address those shortcomings, and this is another IRMA requirement. It isn’t about getting a gold star; it’s an honest effort to earn one.
Thanks to the commitment of its members, IRMA’s multi-stakeholder governance model has earned trust that is increasingly recognized externally. Dozens of studies, assessments and public statements from civil society, companies and international agencies have unambiguously identified IRMA as one of the most robust, transparent and effective standard in the market.
Importantly in the Canadian context, Indigenous-led entities such as the First Nations Energy and Mining Council, BC Assembly of First Nations and the National Assembly of First Nations have recognized IRMA as a standard that can guide responsible mining while recognizing and protecting the rights of Indigenous peoples.
This level of recognition from rights holders and stakeholders is both rare and well earned, and it points to how IRMA might be leveraged to bridge the trust gap that industry and government are now trying to close.
As governments turn once again to mining as a nation-building endeavour, we need to be honest about the barriers and specific solutions. The trust gap can’t be spanned simply by going faster, and if we try that approach, we will fail. But if we take the time to rebuild trust through transparency, independent rigour and stakeholder ownership of the process, we might just get there.
