As the shift away from fossil fuels towards clean energy minerals gathers pace, asset owners and managers have a key role in ensuring mining companies oversee a just transition, according to a new report by the London School of Economics and Political Science (LSE) Grantham Research Institute’s Just Transition Lab. The report focused on a dual trend in the mining world: the phase-out of coal, and the rapid growth in demand for ‘energy transition minerals’ (ETMs) such as copper, nickel, lithium and rare earths. “The scale and complexity of this task requires informed and proactive investor participation in shifting the mining sector towards more sustainable and equitable practices,” the report argued. On the coal side, the key challenge is protecting communities that have been economically dependent on coal extraction. On the ETM side, it meant ensuring the rush to extract these metals does not come at the expense of the local environment or communities. “A just transition agenda for investors would build on three priorities: respecting communities; protecting workers; and developing local economies,” the report said, arguing investors had two tools available: dialogue and capital allocation. Among its recommendations, the report said investors should seek to deepen engagement with mining companies; communicate expectations to governments as bondholders; encourage mining companies and governments to consult unions, Indigenous groups and local communities; and explore opportunities to contribute to regional economic development.
