Aidan Davy Deputy President & Senior Program Director Mining’s Contribution to Development: What do we know about stakeholder views and expectations Aidan Davy Deputy President & Senior Program Director ICMM’s vision is one of leading companies – working together and with others – to strengthen the contribution of mining, minerals and metals to sustainable development. For that reason, it is a privilege to be here today to discuss stakeholder perspectives on mining's contribution. www.icmm.com

Opening remarks What we know about views and expectations is limited by who we have asked Perspectives of local, national and international stakeholders will differ Linkages between mining activity and contribution and development are poorly understood – and often contested Why do stakeholder perspectives matter? Stakeholder perspectives matter for lots of reasons – but in the context of Africa and development, they matter because mining is becoming increasingly important in the economies of many countries. In terms of value of production from mining , 3 of the top 20 countries globally are in Africa: South Africa, Ghana and Zambia. However, almost half of the top 20 countries globally – in terms of the contribution of mineral exports to total exports – are in Africa, including the top 3: Botswana, Zambia and DRC. We know from ICMM research that foreign exchange earnings from mining exports can create positive development benefits…. So stakeholder perspectives are profoundly important. www.icmm.com

Economic importance of mining/metals Mining Contribution Index (ICMM, 2012) In 2012, ICMM developed an initial step towards measuring the importance of mining and metals within national economies for all countries in the world. This was based on three measures – contribution of mineral exports to total exports, change in mineral exports contribution from 2005-2010, and contribution of metallic minerals to GDP. These measures formed the basis for percentile rankings of the relative importance of mining to national economies. It does not capture a range of other direct and indirect contributions – such as employment, local procurement, social expenditures – so this is a first step. The ratings for a selection of African countries are shown on this slide. The key point here is that setting aside objective measures of contribution, perceptions of contribution are profoundly important in Africa. Percentile rankings www.icmm.com

Mining related issues important to stakeholders This slide provides some insight into stakeholder perspectives on issues facing the mining industry. It was based on almost 850 responses from stakeholders in 81 countries – and compares perspectives from 2007 and 2010. It signals that environmental, social and Health & Safety issues are of increasing importance to stakeholders – and so too is the importance of mineral revenue transparency and management. 2007 2010 81 countries, all regions, 847 responses (2010) www.icmm.com

Stakeholder respect by sector (2012) This slide from a recent Globescan Survey shows stakeholder respect for different industrial sectors. The harsh reality is that respect for mining is on a par with Banking – slightly better than oil, gas and chemicals, a lot better than companies involved in producing beer, but far behind IT and automobiles, which ironically are very heavily dependent on the products of mining. www.icmm.com

Respect for mining varies across countries (2012) This slide – from the same Globescan survey – shows that respect varies between countries. If you want to be respected as a miner, Nigeria is the place to be. Peru is tougher. What we don’t know is why these perceptions very so markedly. www.icmm.com

Priority issues for industry to address (2012) One interesting factor is how perceptions of priority issues vary between countries. Across many Asian countries, environmental issues are the top concern. In Nigeria, corruption is the priority. Whereas in Kenya, the UK and USA, working conditions are seen as in most need of attention. www.icmm.com

Distrust in business and governments This slide – from a global survey by Edelman based on 26000 responses – does not present a sector-specific perspective on mining, but it is nonetheless interesting in shining a light on the key reasons for low levels of trust in business and government. Corruption is a primary factor in eroding stakeholder trust as are the wrong incentives as a driver of either business or government decision-making. Transparency also features prominently as a reason for low levels of trust in business and government. 21 countries, all regions, 26,000 responses (2012) www.icmm.com

For further information please contact: Aidan Davy, Deputy President & Senior Program Director aidan.davy@icmm.com www.icmm.com In concluding, while we know a certain amount about stakeholder perspectives on mining, we know a lot less about their perspectives on the contribution of mining to development. I am also acutely conscious that many of the perceptions of the contribution of mining to development are also influenced by one key factor: All the larger contributions of mining – in terms of Foreign direct investment, export earnings and government revenues – accrue at the national level. The smaller contribution (such as direct employment, local sourcing and social investment) apply at the local level. But it is at this level that the more disruptive effects of mining are experienced – environmentally, socially, economically. 9