
Mining companies are holding firm on environmental, social and governance commitments despite the Trump administration’s anti-ESG stance and record investor outflows from sustainable funds.
Global sustainable funds experienced record outflows of $8.6 billion in the first quarter, reversing the previous quarter’s $18.1 billion inflows, according to Morningstar data. The US recorded its tenth consecutive quarter of outflows while Europe saw its first net outflows since 2018.
“An increasingly complex geopolitical environment, including the return of Donald Trump to the White House, and new anti-ESG policy measures have prompted asset managers in the US, many with global operations, to adopt a more cautious stance,” said Hortense Bioy, head of Sustainable Investing Research at Morningstar Sustainalytics.
However, mining industry leaders insist their ESG strategies remain unchanged, dismissing political pressure as irrelevant to sound business practice.
“The commitment of ICMM members to responsible mineral production remains as strong as ever and will continue to progress,” said Rohitesh Dhawan, CEO of the International Council on Mining and Metals. “Every time we have made a commitment in the past regarding ESGs it’s been for sound business reasons. It’s not like it’s done for show or for the PR of it, it was done because it made sense for the business.”
Dhawan argued that political sentiment cannot override commercial logic. “There would be no reason to roll that back now because of certain points of view that someone may have on the concept of ESG or sustainability because it doesn’t change the business imperative to do the right thing. That there is a certain political mindset in Washington doesn’t change the fundamental rationale for taking these steps because the steps are ways to make your business more resilient.”
He cited water management as a prime example. “We’ve had pretty strong commitments on water reporting and management as the ICMM for many years now and some people might say that that is part of an ESG approach that needs to be questioned. But why would you change your attitude to better water management? That’s a good thing for your business because it makes you more resilient, it’s a good thing for your relationship with communities, and it lowers your costs.”
South African mining executives echo this sentiment with equal conviction. “When it comes to ESG and the South African mining sector, to a company they are all very good corporate citizens on the broad subject of ESG,” said Paul Dunne, CEO of Northam Platinum and president of the Minerals Council South Africa.
“We all produce separate sustainability reports these days and the volume of content and material is extensive. You should expect that to accelerate, not to slow down,” Dunne added, noting his company’s ambitious 60 percent carbon intensity reduction target by 2030.
The business case remains compelling as key markets like the EU impose carbon penalties on imports, while South Africa’s expensive and unreliable state power drives renewable energy adoption.
Despite Trump administration policy shifts, including a temporary moratorium on Foreign Corrupt Practices Act enforcement, industry leaders maintain that ESG principles boost profitability and business resilience long-term.
The full article is available in The Mining Yearbook. Click the link below.