MIIF prioritising ESG for sustainable mining - Targets galamsey's environmental havoc
The Minerals Income Investment Fund (MIIF) has placed Environmental, Social and Governance (ESG) principles at the core of its investment strategy, as it aims to transform the mining sector into the first pillar of the economy, while ensuring long-term environmental sustainability.
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"For MIIF, our investments, especially in mining, have a direct impact on the environment. This makes it crucial for us to have ESG as the pivot on which all our investments rest,” the Chief Executive of MIIF, Edward Nana Yaw Koranteng, said in a recent media interview during which he outlined the fund's commitment to ESG.
Menace to society
The emphasis on ESG comes at a critical time for Ghana's mining industry. The sector, particularly illegal small-scale mining, also known as ‘galamsey’, has been under scrutiny for its environmental impact, including the destruction of cocoa farms and pollution of water bodies.
The Ghana Cocoa Board (COCOBOD) reports a 20 per cent reduction in cocoa production over the past five years, primarily attributed to illegal mining activities. This has resulted in a significant economic loss for the nation, estimated to be approximately $2.3 billion annually.
Furthermore, the Forestry Commission has documented a loss of more than 2.5 million hectares of forest cover due to galamsey.
On August 31, 2024, the Ghana Water Company Limited in the Central Region blamed galamsey for recent water supply challenges in Cape Coast, Elmina and surrounding communities.
On September 2, 2024, the company announced that it might have to close two major treatment plants in the Ashanti Region due to high turbidity levels, which had increased production cost.
Head-on
MIIF's strategy aims to address those concerns head-on, recognising that the future of mining in Ghana depends on sustainable practices.
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"If we want to invest in mining and make it the cornerstone of our economy, why would we invest and lose our ability to provide food, protect the environment and safeguard our water bodies," Mr Koranteng questioned, stressing the interconnectedness of mining and environmental health.
MIIF, according to its CEO, was not merely paying lip service to ESG principles, but the organisation was actively implementing concrete policies that reflected its commitment to sustainability.
Mr Koranteng explained that every investment and programme undertaken by MIIF was evaluated through an ESG lens, saying “This ensures that environmental considerations are a central part of all decision-making processes”.
He mentioned one of such initiatives as the Small-Scale Mining Incubation Programme designed to formalise a sector that contributed significantly to Ghana's economy.
“By focusing on traceability, environmental governance and ESG principles, this programme aims to improve the sustainability of legitimate small-scale mining operations,” he stated.
MIIF's approach to ESG aligned closely with government policies on mining sustainability, Mr Koranteng added.
“This includes strict regulations for decommissioning mining sites and environmental bonding. Additionally, the organisation is actively involved in supporting scientific attempts to clear the silted rivers as a result of illegal mining, advocacy and education efforts,” the MIIF CEO stated.
“By promoting environmental awareness and understanding across various sectors of society, MIIF is working to build a broader consensus on the importance of sustainable mining practices,” he added.
Surmounting challenges
The focus on ESG is not without its challenges. Some industry observers have argued that the battle for environmental sustainability in mining is an uphill one.