KOLKATA (miningweekly.com) - India should implement a sustainable-performance ranking system for mining companies, based on aspects of mining sustainability, a report from a subgroup of India’s Planning Commission has recommended.

Aiming to lay down a roadmap during the 2012 to 2017 period, the Planning Commission subgroup said that mining companies should be encouraged to report on sustainability according to standards employed by the Global Reporting Initiative (GRI), namely the GRI's Mining and Metal Sector Supplement for sustainability reporting.

However, it also noted that there was no international organisation capable of passing and implementing performance standards for the mining industry as a whole, despite the urgent need to evolve such standards through consensus.

Such a consensus had been elusive as no process currently existed for balancing the different the interests of rich countries of the 'north’ and those of the poor countries of the 'south’, while traditional overseas mineral investors in regions of Europe and North America have been consulted more than so-called 'emerging investors' in countries such as Brazil, China, India, Russia and South Africa.

The subgroup recommended that the Indian sustainable-performance ranking system should weight the following parameters most: biodiversity and ecosystem services, financial fundamentals of profit margins and growth rates, environmental performance indicators, solid industrial waste, leached ore residues, effluents and greenhouse-gas emissions.

Other parameters suggested were labour and social performance indicators, product responsibility, community development, human rights, diversity and employment opportunity, employment conditions, health and safety management, occupational diseases and the incidence of work-related accidents, and mine closure plans.

Each of the parameters should be accorded marks out of 100 and a weighted final score taking into account each parameter would yield a score out of 100.

Mineral Development Fund Suggested

The Planning Commission subgroup also recommended the creation of a national mineral development fund and, as the provinces have a major stake in mining activity, that 15% of royalty accruing to the provinces be collected by the fund. 

As prospecting was considered a high-risk venture, access to risk funds from capital markets and venture capital for miners should be facilitated by the government and companies investing in early-stage exploration, while mining should be encouraged through segmented exchanges, to replace the differential listing requirements that were currently permitted, the group said.

On the availability and demand for human resources in the mining sector, the group noted that the industry was the largest employer with over 900 000 engaged in coal, metallic, nonmetallic and other minor metals. Coal accounted for over 75% of those employed in mining, while contractual workers constituted 40% and women a mere 7% of the mining workforce.

Quoting a report from the Mines Ministry and the Confederation of Indian Industry the subgroup said employment in the mining sector would increase to 1.06-million by 2017 and 1.20-million by 2025.

However, according to the study, a significant challenge would be to bridge the current gap in mine skills planning, and operations and safety-related knowledge, particularly among newly trained managers.

A further challenge was to retain trained mining managers in the industry, owing to the increasing trend of mining managers being lured to management studies by more attractive remunerations and perks as management professionals in other sectors.