The mining industry stands at a critical juncture. As global demand for critical minerals surges—driven by the renewable energy transition and national security concerns—the question of how investors can ensure mining companies truly respect people and planet has never been more urgent.
Investors: A Diverse Ecosystem with Varied Responsibilities
Investors aren't a homogenous group. Different investors 'show up' to support different parts of the mining life cycle and – within that – different types of enterprise. Understanding this diversity is crucial to recognising how each can contribute to more responsible mining practices.
The Power of Contracting and Ongoing Engagement
First and foremost, investors can get better at carrying out Environmental, Human Rights, and Social Due Diligence (EHRDD). Beyond ascertaining their exposure and influence, the most crucial moment for pushing mining companies to do better is at the point of contracting because expectations can be baked into legal agreements.
But investors then don't sit back; the good ones monitor and mentor, regularly engaging with their business partners and affected rightsholders to mitigate risk. They also get on the ground, especially to the highest risk assets, and put in place their own grievance mechanisms to support access to remedy for affected rightsholders.
Strategic Investment Areas
Investors can also have an impact by investing in two key areas: the emerging technologies and systems that are driving cleaner production, and enterprises owned by equity-seeking groups. This might be a better space for venture capitalists, but we are seeing a funding gap here that needs addressing.
Sustainable finance can do more to learn about the roles they can play in making mining more sustainable. There is a cognitive dissonance – or indeed hypocrisy – in investing in mineral-dependent parts of the economy, like renewables, and refusing to support making the supply chains that make those investments feasible more sustainable.
Best Practice vs. Reform: A Question of Risk Appetite
The question of whether investors should prioritise investing in best practices or influencing reform depends on their risk appetite. If they have a low-risk appetite, they have to limit themselves to best practice investments. Whatever risk appetite they have, they have to be adequately risk-ready to mitigate as much risk away as possible. A lower-risk appetite firm can enter a slightly higher-risk situation if its risk controls are excellent.
But ultimately, there's greater power in being part of the transformation, especially where capital can unlock the funds needed to shift companies to internalise more sustainable practices. The G7's new Critical Minerals Action Plan has committed to developing standards-based markets, which will strengthen the business case for investors and miners to adopt best practices.
Beyond Tick-Box: Meaningful Benefit Sharing
When it comes to ensuring that sharing the benefits of mining with local communities leads to meaningful local development, shared prosperity and fairer transitions, there's a lot more that can be done.
Current Challenges
Most miners don't identify themselves as engines of sustainable development first and foremost (through which they get the social licence to operate and the right to make a profit); most still focus on getting enough social acceptance to be able to operate, but this may not mean they're optimising the opportunity for positive impact.
Meaningful stakeholder engagement and participation are rare. Some miners rely upon being a nation’s principal taxpayer but either lack or don’t use their leverage to push the state to repatriate a fair portion of those revenues into meaningful development for the mine’s affected communities. This generates considerable frustration and anger among local communities.
In some cases, miners are grossly underinvesting in local community development relative to others who are investing in the local economy. For example, informal investment from Chinese or other actors in local artisanal and small-scale mining (ASM) may far outstrip a mine’s CSR or community investments, so the mine can't compete, which creates a barrier to effective ASM engagement and management, as well as to strong community trust and cooperation.
There is inadequate attention to gender too, whether about how women and girls are disproportionately harmed by mining or how underinvestment in their empowerment holds back economic growth and social development. Equitable benefit sharing means gender-responsive engagement, enterprise development and community investments.
Signs of Progress
Despite these challenges, there is definitely progress! Some miners are innovating with greater equity participation for Indigenous Peoples and local communities, as well as greater integration into governance and decision-making. A mineral processor, Mwamba, in Tanzania, and a gold producer and trader, PeaceGold, in the DRC, are structured as social enterprises to ensure shared prosperity and a commitment to the enterprise by their ASM partners.
There is growing collective action in some territories, including cross-supply chain cooperation in Indonesia, DRC, and Brazil. And the IRMA standard is expanding its capture of critical minerals production, with Chinese and Indonesian enterprises now pursuing assessments.
Balancing Urgency with Responsibility
As national security dominates the global discourse, astute businesspeople are always questioning demand projections. We can minimise the risk of the acceleration of mining trading off local communities and ecosystems by:
- Tackling demand through dematerialising use. Consumer and structural decisions really matter—from choosing second-hand equipment to optimising material efficiency.
- Tackling underinvestment into critical minerals recycling infrastructure in market nations, but also in the Global South.
- Recognising that supply chain resilience and permitting times depend on building trust with and delivering meaningful impact to affected communities.
- Supporting and strengthening the capacity of human rights and environmental defenders.
- Building the capacity of regulators! Many permitting departments are under-resourced, with either too few people, inadequate knowledge, or a lack of access to technologies that would make them more efficient. We are most likely to address permitting issues if we equip public agencies to be excellent.
The Path Forward
To transform the mining industry, investors need to be willing to engage beyond traditional financial metrics. By advocating for higher standards, innovating new capital deployment structures, and listening to and meaningfully engaging with rightsholders, investors can ensure their systems are effective, and their impact is meaningful.
The future of responsible mining depends on this holistic approach—one that recognises that respecting people and planet isn't just good ethics, but also good business.
These remarks were part of a June 2025 panel on "Breaking with the past: Can mineral production build shared prosperity?" organised by Business & Human Rights Resource Centre and Climate Home News during London Climate Action Week.
