Investors request ‘urgent’ information from mining companies
The Church of England Pensions Board (CEPB) and Sweden’s AP funds have written to nearly 700 listed mining companies with an “urgent request” for information about their management of tailings dam facilities.
Companies were requested to disclose the information on their website within 45 days. A list of the 683 companies receiving the letter is due to be published on the CEPB website after the deadline, together with their level of compliance.
The move is aimed at providing a tool for institutional investors to assess the risk from their holdings in mining companies. It forms part of the global investor engagement in response to the recent Brumadinho disaster in Brazil, when 100 people were killed after the collapse of a dam used to store waste products (tailings) from iron ore mines.
The letter was sent by the CEPB and the Swedish Council on Ethics for the AP Funds, and is supported by 96 investors with US$10.3trn (€9trn) assets under management, including APG, CalSTRS and the New Zealand Superannuation Fund.
It follows two high-level investor round tables convened by the CEPB and Council on Ethics, with another meeting scheduled for May.
The extractives companies have been asked to provide an overview of their tailings management system, and how they manage risk. They should also confirm whether their approach to tailings management has changed following Brumadinho and other disasters.
More specific requested information includes:
- A list of all tailings storage facilities and their ownership;
- Height and storage volume;
- Date of latest independent expert review;
- Details of engineering records (design, maintenance, etc.)
- Concerns about stability; and
- Assessment of the impact of extreme weather events.
If companies are unable to provide the information, the investors have asked that they explain why and clarify what action was being taken to address this. The disclosure, which should be signed by the CEO or board chair, must be published on the investee company’s website by 20 May.
Companies were also urged to consider how to communicate the information to communities affected by the tailings footprints.
Current disclosures ‘inadequate’
A CEPB spokesperson said: “This is an initiative designed to inform investors about the risks they are running in holding certain companies in their portfolio. We have asked for very clear information and investors will be able to see which companies have provided it.”
Adam Matthews, director of ethics and engagement, CEPB, said: “The current disclosures from companies are largely inadequate. It is essential that investors can establish a clear line of sight on which company has which tailings facility and how it is being managed.”
He continued: “We are working across the investment community and with expert input to create a global database to assess this information.”
John Howchin, secretary general of the Council on Ethics, said: “The need for serious action is very clear. These tailings dams are here for eternity and we need to set a global system in place to handle them.”
The letter, together with the questionnaire and list of supporters, can be found here.
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