Interview - Sustainable Mining

Ben Chalmers: TSM program can be a roadmap for Mongolia’s mining sector

2019  |  October   |  023

Towards Sustainable Mining” program under the Mining Association of Canada was established in 2004. It is currently the main program regulated in Canada’s mining industry. The TSM program enables mining companies to meet society’s needs for minerals, metals and energy products in the most socially, economically and environmentally responsible way. Additionally, it has become the key standard for sustainable mining at the international level. We spoke with Ben Chalmers, Senior Vice President of the Mining Association of Canada which plays a key role in promoting and implementing the program. 

-Canada successfully developed sustainable mining practices. There must have been many challenges along this road. What results were achieved under the sustainable mining initiative? 

-Our country has a long history of mining. Canada was built in part on mining, so we’ve been doing this for a long time. When we started the TSM standards fifteen years ago, only 50% of our mines could meet the good practice level of standard. It took us many years to get to the point where most of our mines meet these standards. The TSM program includes protocols on community engagement, biodiversity conservation management, energy use, greenhouse gas emissions management, safety and health, and tailings and water management. We believe that TSM could become a roadmap for other countries including Mongolia that have identified their need to improve the management of social and environmental issues. That’s in part why we’ve decided to share this program freely so that other countries can take a program that’s already built, modify it to their country contexts, adapt it and begin measuring their progress. 

-You mentioned that it takes a five-year preparation before implementing the TSM standards. Can you elaborate on that?

-It takes five years to prepare before implementing the program and seeing the results. For us, we established the first foundations in 2004 and companies started their reportings against the TSM standards in 2006. When a country chooses to adopt TSM, the agreement does specify 5 years. By the end of that 5 years, they have to establish it as a condition of membership. It is expected that the association makes this mandatory for companies to participate.

A standard that will help companies without a good management practice to do so

In the first 5 years, an advisory panel or a multi-stakeholder panel must be established. Secondly, Mongolian versions of the standards for companies to measure themselves against will be published. Thirdly, the country’s mining association will publish industry-level data to see where the industry overall is. And eventually, within the 5 years, individual evaluations or company level reporting will take place based on the industry data. 

-It is mentioned that mining companies are rated from C to AAA scores by the TSM standards. What are the benefits of such a rating? Wouldn’t it become a regulatory burden or pressure?

-It should be recognized that companies have significant demands or interest in reporting and verification from independent auditors. The TSM standards are very efficient, though. You’re reporting on 29 scores every year, instead of writing a whole report. Also, you should bring in auditing every three years for verification. In other words, the company’s performance is assessed against only 29 questions, putting less pressure or burden on the companies and allowing them to save time and money. There are other benefits as well. First, it provides a standard that will help companies without a good management practice to do so, without having to figure out on their own what that looks like. For large companies with existing social and environmental management systems, the TSM allows them to evaluate those internal systems against an external set of standards, giving their systems more credibility.

We heard from companies today that they deal with different issues and different standards. So, for example, Oyu Tolgoi has its own major set of standards that they comply with. What TSM offers is a common set of commitments and measurements that a national industry will take on collectively. So, they all start focusing on the same metrics which allows you to measure broad progress and communicated only. In other words, companies start talking in the same language which allows the public to be much more comfortable with the performance of the mining. This is the biggest outcome of the program. 

-You mentioned that TSM standards are applied by 80 percent of Canadian mining companies. You also said that it took significant time and preparation to introduce these standards in 2004. Since then, you seem to have achieved a lot within this period of more than ten years.

-It depends on the indicator. When you look at tailings and community engagement, for instance, we were only about 50 percent. Now, 90 percent of the companies have an AAA rating.  

-Regarding the 29 questions or indicators, what would happen to the company’s grading if it fails a single question? 

-In any one of those 29 indicators, they have to achieve all of the criteria to the level that they are graded at. For example, “A” score on water management and “B” score on community engagement, etc. To put it simply, there isn’t a single certification or a single grade that the mine gets overall. They get 29 scores. So, it doesn’t diminish their recognition for where they’re doing well. It’s just, in that particular area where they missed something, they take a lower score.  

-Canadian mining companies established a multi-stakeholder Advisory Panel that includes community members, religious members, and researchers. What is the role of this panel? What results are achieved by establishing this panel? 

-In one sentence, they keep us honest. But in more detail, they provide oversight and recommendation. When we are developing these standards or modifying them, we review those standards with the panel to make sure they’re credible. We also advocate for new areas. For instance, the Biodiversity standard is in there, because the panel pushed it. They also play a role in the assurance process. 

I mentioned before that companies assess them every year and invite third-party verification every three years. The panel will invite two of these companies for greater examination. We also engage with the panel on issues outside of TSM. This means we will seek their advice on issues that are not currently covered by TSM that may be of interest to both them and us. So, it provides a national dialogue space for mining issues.

-The TSM standards have been adopted by seven countries so far. Were there any risks and challenges in applying them in other countries? What is the current progress?

-It all happened in the last 4 or 5 years. So, none of these countries have finished the full 5-year implementation. Finland is the closest. They’ll start reporting next year. One of the common challenges in the industry has to demonstrate that the TSM standards are useful. It took Canada 15 years to do this. But each country, each mining association and each company will have to demonstrate that it’s committed to using this in a meaningful way.

Water is a brand new protocol for us. Next year will be our first year of reporting

There are some challenges around the community panel. The industry has to help build comfort with the people that will potentially be sitting on that panel who might otherwise be facing some risks with coming to an industry or organized discussion table. Because there are potential reputational impacts, the industry will have to prove that this is a legitimate, meaningful process. It could also be uncomfortable for national industries to commit to the level of transparency, detailed performance evaluation, and engagement with national stakeholders. So it’s a bit of a challenge getting comfortable with that.

-Do you see an opportunity for Mongolia to adopt the program? What is your take on how Mongolian mining companies and the legal environment would accept the standards? 

-I think it speaks volumes that the number of people we had here for two days to learn about the TSM program and the fact they’re even thinking about undertaking this level of transparency and their willingness to measure and be compared against each other. It speaks to an industry that has recognized its need to evolve and do things differently.  

-In recent years, the topic of social licensing has attracted strong interest. What is your opinion on sustainable mechanisms to remove misunderstanding between indigenous people and mining companies? 

-We have this part of the TSM – community and aboriginal outreach protocol. It has long been about helping companies engage better with communities. We are in the process of updating this protocol and it will take on a new title “Indigenous and Community relationships”. We have learned that a big part of earning that social license is working in partnership with communities and building meaningful relationships with them. TSM recognizes that how you engage with each community is different because each community will have a different view of what it wants to pursue and how it wants to work with the companies. So, the TSM program tries to guide how companies should set up their engagement practices to work with the communities to understand how they want to be engaged. I think that’s a big part of how social license works.

-What is the current trend in the global mining sector? The notion of sustainable mining must cover many things. We talk about responsible mining in Mongolia a lot. Can you define the current status of responsible mining?

-I think they’re just words. Actions are what’s important. The notion that mining can be sustainable is questionable. Eventually, a mineral deposit is gone. But part of the notion of partnering with communities is to make sure that the benefits from mining sustain themselves beyond the life of the mine. We’re always journeying towards what is ideally sustainable. What we’ve been doing around responsible or sustainable mining practices has always been grounded in working with affected communities. The biggest trends we’re seeing are greater interest from investors and our customers. While investors have been going slowly overtime towards responsible and sustainable mining practices, the customer or end-users of our metal and minerals are starting to demand that we demonstrate responsible practices from recent years.

-How did Canada’s water management in mining evolve? You mentioned that standards on water management have only started two years ago due to environmental issues and the legal environment. Did you see any results? 

-Water is a brand new protocol for us. Next year will be our first year of reporting. Companies are working with it currently. Presumably, they are improving their practices. However, I can’t say comment on the progress until we see them. Canada had very stringent regulations in place already before the TSM protocols. So, water management includes many elements.

-How do Canadian mining companies address the safety and health of their employees? What are the standards for greenhouse gas emission and efficient energy use? 

-The safety protocol has five indicators and the fifth one requires the company to set targets. If they have a fatality in the reporting year, they cannot get an A. 




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