Sustainability. We have heard of this concept, perhaps verbalized it to describe certain changes in business and government behavior, and we are pretty sure its sounds like the right thing to be doing. But what is sustainability in the real world, particularly in natural-resource industries? The short answer is: It depends.
According to the U.S. Environmental Protection Agency, Sustainability creates and maintains the conditions under which humans and nature can exist in productive harmony, that permit fulfilling the social, economic and other requirements of present and future generations. Among the things we could currently consider, the EPA suggests we promote personal sustainability by furnishing our homes with environmentally preferable products, perhaps furniture containing recycled content or recycled materials. The raging debate centers on how engaging sustainable practices now accommodates the future.
Setting aside personal choices, can industries incorporate the concept of sustainability into their business models because of increasing demands by those who hold companies accountable for their business practices? Idahos natural-resource-based companies, particularly in mining, have been continually integrating sustainability into their business planning as a means to advance their interests in the marketplace and protect their assets. However, just as several blind men described different parts of the elephant in exceedingly different terms, so too is the real-world application of sustainability for companies dependent on the land to support their businesses, jobs, and, in some instances, shareholder expectations.
Some say that genuine sustainability means that the Earth is made whole and in some instances should be improved by human activity. This view postulates that many, if not all, resource-based industries, including mining, are not, and will never be, sustainable. For those of us who counsel mining companies, the concept of sustainability must be viewed through the lens of reason. If we assume that humans will continue to populate the Earth, with needs that require natural-resource extractions, the sustainability demanded by the marketplace is different.
According to Luke Russell of Coeur dAlene Mines, Sustainability begins with sound business practices that ensure the viability of an enterprise. By any reasonable definition, to be sustainable, a company must first be profitable. But sustainable companies also focus intensely on the health and safety of their workforce and the well-being of the people and communities in which they operate. This includes the highest regard for environmental stewardship. At [Coeur dAlene Mines], these are not just programs, but rather our core values that help lay the foundation for our demonstrated commitment to building local partnerships, developing worker skills, monitoring and protecting the environment and fostering business alliances based on trust. In other words, this genre of sustainability (profitability, safety, community partnerships) reinforces a companys value system.
Environmental stewardship is also a cornerstone of sustainability. In the mining industry, the sustainability journey includes minimizing surface disturbance, managing wastes safely and responsibly, recycling and beginning with the end in mind through the development of mine closure plans even before construction commences. The potential costs in share value and potential legal exposure hinging on these events mean that in todays natural resource-based corporations, these efforts are closely tracked and guided in the board room.
In practical and real-world terms, sustainability, whatever the form, provides value both in terms of share price and certainty to the business model. If executed deftly, sustainable business practices can protect natural-resource-based companies from, among others, the threat of environmental citizen-lawsuit litigation and contentious encounters with regulators.