Mining companies, particularly those funded by large multi-national commercial banks, are required by their financiers to demonstrate appropriate management of environmental and social impacts. However banks often face obstacles in applying responsible mining principles and thus face challenges ensuring responsible mine development.
Financing mining activities in the Heart of Borneo
1. Prioritize responsible finance
- Adopt the Equator Principles: These voluntary Principles are the standard across the financial sector for determining, assessing and managing social and environmental risk in project finance. The Principles provide detailed guidance to banks and their clients to manage environmental and social impacts.
- Promote the IFC Mining Industry Guidelines: Banks should encourage their clients to adhere to these guidelines, which have been developed by the International Finance Corporation (IFC).
- Use spatial biodiversity risk tools: WWF can help support financiers in identifying and avoiding areas of high biodiversity value. Contact us to find out more
2. Explore new financial incentives
A range of new financial incentives are available to mining companies to support them in a transition to more sustainable production. Examples include:- Carbon markets, which currently provide payments for reduced carbon emissions by generating carbon credits under the Development Mechanism (CDM) which can subsequently be sold in the carbon markets. Under the CDM coal mining companies can receive payments for projects which reduce emissions of coal bed methane for example.
- Payments for Reducing Emissions from Deforestation and forest Degradation (REDD+), whereby mining companies may be able to receive REDD+ payments for minimising forest damage and forest restoration activities if they can demonstrate that they are helping to reduce emissions.
next steps
- Check financial mechanisms to support sustainable land use in the Heart of Borneo
- Explore tools that make it easy to incorporate natural capital into decisions
- Read the Economics of Ecosystems and Biodiversity (TEEB) study, an initiative to draw attention to the global economic benefits of biodiversity
