Abrdn tackles mining companies on behaviour

Edinburgh investment giant Abrdn said it has engaged with some of its largest mining holdings following “incidents of unacceptable work-place behaviours in the sector, including sexual harassment and assault.”

The asset manager has produced a statement with recommendations to ensure the wellbeing of employees which has been endorsed by both the International Council on Mining and Metals (ICMM) and several mining
companies, including the CEOs of some of the world’s largest miners.

Abrdn manages and administers about £500 billion of assets.

“The statement reflects the positive steps we have seen as part of our engagement to address workplace issues and recommends for further action that companies should consider to bolster these efforts,” said Abrdn.

“These include the expansion of established health and safety mechanisms, including governance oversight, plus links to remuneration and monitoring and reporting to assure the psychological wellbeing of employees.

“The mining industry is central to the economy of many countries, global growth and the transition to a low carbon economy.

“However, the sector is often criticised for its social impacts. More recently, criticism has been centred on unacceptable workplace behaviours, illustrated by incidence of sexual harassment and assault in Australia and elsewhere in the world.

“We recognise the challenge and complexities of this debate, however, in our view, constructive dialogue and engagement with the mining industry offers the best opportunity to support safer workplaces and a just energy transition.

“From an investment perspective, performance that fails to meet stakeholder expectations can lead to operational disruption and reputational damage that can negatively affect investor sentiment and asset values.

“This, combined with concerns about environmental degradation, have led some investors to exclude or divest from all mining companies in the name of sustainability.

“While this is understandable, this approach overlooks the fact that our future – which depends on renewable
energy, mobility, sustainable cities and a zero-carbon economy – relies on the availability of metals and minerals.”

Andrew Mason, head of active ownership, Abrdn said: “Our key conclusion is that mining companies should use all the tools they have available to them – governance, performance incentives, oversight, monitoring and reporting – to improve workplace behaviour, diversity, equity and inclusion, and apply the same rigour of existing health and safety regimes to psychological safety.

“Many mining companies have demonstrated a strong track-record in improving health and safety, embedding aspects into all areas of their organisational cultures and business processes.

“We believe that employees’ psychological wellbeing warrants a similar approach.

“There are so many ways that mining companies can become much more responsible towards the environment and to the people involved in every aspect of the industry. It is up to us as active stewards to help these companies on the path to self-improvement.”