Sustainablity
Report 2019

Human rights May 2020

The dilemma of investing in social and environmental remediation activities

In times of Europe’s coal phase out and global climate activism, it is essential to ensure and demonstrate that the remaining coal coming here is supplied responsibly.

As many know, we purchase this commodity mainly from Colombia and Russia, two countries where cumulative impacts of mining operations affected, and still do affect hundreds of people, mainly vulnerable rural communities with little access to effective remedies.

For example, while in Kuzbass in September 2019, as part of a Bettercoal mission, we managed to see the town of Kiselovsk, mentioned by the NGO Ecodefense as one of the most impacted by mining. Even if we stayed there for a very short time, it was sufficient to recognize how close to houses the mining operations are. Even more telling was the visit to the village of Chuvashka, where locals have been struggling for years with several local mining operators, whose community relations practices seemed quite underdeveloped.

As a result of the trip, we are now in contact with local stakeholders to support the transformation of inevitable resettlement activities in sustainable development programs. Moreover, we are looking into opportunities to give back to nature former mining areas which are now abandoned since the nineties and could be turned into new forests and grazing lands, following circular economy approaches which would then benefit both the environment and the local communities.

From an external perspective, it sounds all quite good, right?

On one hand, it is indeed great seeing these kind of developments, signs of a growing awareness and interest of the business to heal the wounds of the past. On the other hand, it unfortunately bring us to a practical dilemma any company like us is facing when dealing with these issues.

We noticed that the most severe, ongoing impacts, and thus the biggest remediation opportunities, were in the proximity of operations which are not directly engaging with Bettercoal nor with us. Without strong commercial or regulatory incentives to do the extra mile, companies tend to rely on compliance with practices which might be based on inconsistent policies or out-to-date rules.

According to TDI Sustainability, an international consultancy firm we asked to assess the key sources of environmental and social impacts in the Kuzbass region, this is visible in several legislative gaps.

Here an example: “Russian law states that exhausted mining land should be restored using the original topsoil that was removed from the site when operations began. In many cases mines in Kuzbass operate for 50 years or more, meaning that microbial life in the original topsoil will have long since died by the end of a mine’s production period, and that fresh topsoil from elsewhere would make a better choice for environmental restoration”. In case the mining companies were using fresh topsoil, they would not be in compliance with the law, so they prefer not to restore the areas.

That’s our dilemma. When you are further down in the value chain, you see the impacts occurring but sometimes you cannot directly mitigate them. Even if you want, it is very difficult to invest in projects or initiatives able to address these cumulative impacts, because the stakeholders you must have on board are not always on your same page. That’s why, when we as society support fair coal phase out policies and advocate for market-based instruments to speed up the necessary global transition, we must also support other legislative changes aimed at making the remaining necessary mining operations fully able to prevent or compensate any significant harm to the environment and the people. For example, the obligation to restore parts of abandoned mining areas as pre-condition to get new mining permits is currently under discussion in Russia. Such a legislative proposal might indeed help solving this dilemma, by creating the conditions for a new market of restoration and reforestation services.

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