As companies advance their approaches to nature-related issues, including through implementation of the Taskforce on Nature-related Financial Disclosures (TNFD), it will open up opportunities to rethink their approaches to impact management, benefits sharing and facilitating equitable access to natural capital.
By Caitlin Purdy, Senior Manager
Biodiversity is becoming an increasingly critical sustainability issue for miners as the world seeks to balance the transition to a net-zero economy – which will require an increase in mining to meet ambitious decarbonization goals – with the equally urgent transition to a nature-positive economy. Close to one of six mining operations linked to cobalt, lithium, and nickel are located within one kilometer of a key biodiversity area or protected habitat, while almost half of operational large-scale mines are located in biodiversity rich forests.
Shared value – which broadly refers to the way in which companies manage their impacts and generate and distribute benefits to stakeholders, particularly project-affected communities – is one of many levers mining companies have to act on evolving nature-related risks and achieve nature-positive objectives. Specifically, as companies advance their approaches to nature-related issues, including through implementation of the Taskforce on Nature-related Financial Disclosures (TNFD), it will open up opportunities to rethink their approaches to impact management and benefits sharing and how these can positively contribute to the societal dimensions of nature-related issues, including safeguarding human rights and environmental rights, protecting the rights and traditional knowledge of Indigenous Peoples and Local Communities (IPLCs), and facilitating equitable access to natural capital.
Here we consider three takeaways for a nature-positive approach to shared value.
- Meaningfully engage with project-affected communities on nature-related risks and opportunities
The TNFD has recognized that Indigenous Peoples and Local Communities (IPLCs) play a crucial role in safeguarding nature and also have detailed knowledge on nature, biodiversity, ecosystem management and ecosystem trends. Similarly, the Kunming-Montreal Global Biodiversity Framework acknowledges the important roles and contributions of IPLCs as custodians of biodiversity and partners in the conservation, restoration and sustainable use and calls for their full and effective participation in decision-making. There is already a growing expectation that companies will integrate Indigenous knowledge into project development and planning – the government of Canada, for example, issued guidance on this in 2022 – and developments in the nature-positive space will likely further accelerate this trend.
Consequently, action on nature-related issues needs to be co-developed and co-actioned with other stakeholder groups, particularly with groups who have local or traditional knowledge about nature. This applies to Indigenous Peoples but also extends more broadly. Companies will need to ensure meaningful engagement with project-affected communities as they develop nature baselines for science-based targets and assess nature-related risks and opportunities. This includes ensuring a holistic understanding of stakeholders’ social and economic uses of nature as part of baseline assessments, as well as meaningfully consulting with stakeholders on the state of nature and nature-related risks and opportunities. Stakeholders should also have a meaningful role to play in setting targets and monitoring progress.
- Integrate environmental rights into impact assessment
Companies are likely to come under growing to pressure to explicitly consider environmental rights as part of social impact assessments processes. The right to a clean, healthy, and sustainable environment for all people is now recognized as a universal human right by the UN General Assembly and the right to a healthy environment is enshrined in over 150 constitutions globally. Nature loss and degradation can lead to direct violations of this right and indirect violations of related rights (for example, the rights to food and water). As part of their responsibility to protect human rights, it will be important for companies to develop a robust understanding of what negative impacts a project might have on project-affected communities’ environmental rights – including how these might differ by demographic (e.g. race, income, gender, etc.) – and what opportunities it might present to strengthen these.
- Leverage social investment to protect or enhance nature’s contributions to people
Social investment, particularly in the content of automation, rising inequality, and evolving expectations among project-affected communities, is a progressively more critical component of any shared value approach. Leaders in this space increasingly tie investment to a percentage of profit and turnover. For example, BHP invests 1 per cent of pre-tax profits in voluntary local community and environmental initiatives. Tailoring existing social investment priorities to the emerging nature-positive agenda may open up new opportunities to drive positive impact. As one example, rural livelihoods, including agriculture and artisanal and small-scale mining (ASM), are often a key focus area for social investment. Investment into productive and regenerative agriculture – particularly where this connects with local or Indigenous knowledge (e.g. bush food in Australia) presents an opportunity to minimize impacts on nature while driving socio-economic development.