World Gold Council releases its Responsible Gold Mining Principles

The World Gold Council has released its Responsible Gold Mining Principles (RGMP), a framework for market stakeholders as to what constitutes responsible mining. We should expect this to be complementary to the LBMA Responsible Sourcing requirements, which point more towards the refiners, but which obviously include the necessary parameters to ensure that refiners are sourcing from miners that comply with the guidance that has developed from the Dodd-Frank legislation about conflict minerals and which has expanded via the OECD and the LBMA to a more all-encompassing global set of standards. Indeed, any refiner that does not meet the LBMA’s strict principles cannot be accredited for London Good Delivery.

To this end the WGC Principles shed another light onto the sector, illuminating and defining the requirements for those at the start of the supply chain to adhere to requirements governing Environmental, Social and Governance (ESG) Principles.

These Principles are not de jure mandatory, but the LBMA rules about refinery accreditation along with other international sets of guidance including the United Nations Guiding Principles on Business and Human Rights, plus the Extractive Industries Transparency Narrative as well as the OECD, should provide plenty of stimulus for responsible members of the industry to comply. Indeed, the systematic way of setting them out should make it easier for members of the industry to follow overarching requirements.

The Principles were put together under the leadership of the WGC members, spearheaded by Gary Goldman, the CEO of Newmont Goldcorp, who makes the point that the “formalization of the Responsible Gold Mining Principles is a natural evolution of our daily working practices”.

La Luz Gold Mine complex in Siuna, Nicaragua.
La Luz Gold Mine complex in Siuna, Nicaragua. Image: Wikipedia.

Over 200 organisations and individuals were involved in two rounds of consultation and review. The process included online submissions, bilateral contact, and five independently hosted multi-stakeholders roundtables and involved government, international organisations, civil society, supply chain participants and investors.

Companies implementing the RGMP will be required to obtain external assurance from a third party, independent assurance provider. This will take place both at a site and corporate level, assessing both processes and performance; companies implementing this will be required to disclose their conformance with the RGMP along with the external assurance on the disclosure. To this end, the WGC has devised an Assurance Framework.

The full RGMP and associated documentation can be found here; the essentials are summarized below, along with an assertion that providers of finance and capital should use their best endeavours to encourage the adoption of the framework at gold mining operations where they have influence.

The documentation surrounding the RGMP does take note of the fact that there are many locations where formal gold mining operations work alongside and interact with artisanal and small-scale (ASM) miners. It states that where ASM is conducted responsible and with respect for formal mining titles the Council members will seek to support ASM groups with respect to adopting safe working practices; also, where relevant they will consider the potential for alternative livelihood programmes. It is arguable that there is an unwritten implication here, essentially allowing for the fact that not every ASM operation across the world can be monitored.

The RGMP are designed for implementation by WGC members, but may also be adopted by other entities involved in gold mining, provided they seek independence by assurance providers that meet the requirements in the Assurance Framework that can be found in the link above. The key requirements for Assurance Providers include but are not restricted by the following:

That they have no direct or indirect financial or material interest in the assurance client; no member of the assurance team should be acting for the assurance client in any relevant issue; they should make an explicit statement of independence; they must have experience in ESG in the mining industry, and be able to demonstrate institutional competencies including adequate assurance oversight and understanding of the legal aspects and infrastructure.

The essence of the RGMP is as follows (edited):


1. Ethical conduct: conduct business with integrity, including absolute opposition to corruption.

2. Understanding Impacts: engaging with stakeholders and implementing management systems to ensure that the impact of operation is understood and managed, and realizing opportunities and providing redress where needed.

3. Supply chain: requiring the suppliers conduct their business ethically and responsibly as a condition of doing business with the miners.


4. Safety and health: to protect and promote the safety and occupational health of the workforce (employees and contractors) above all other priorities, and empowering them to speak up if they encounter unsafe working conditions.

5. Human rights and conflict: to respect the human rights of the workforce , affected communities and all those people with whom the miners interact.

6. Labour rights: to ensure that the operation are places where employees and contractors are treated with respect and are free from discrimination or abusive labour practices.

7. Working with communities: to aim to contribute to the socio-economic advancement of communities associated with the operation and to treat them with dignity and respect.


8. Environmental stewardship: ensure that environmental responsibility is at the core of the work.

9. Biodiversity, land use and mine closure: work to ensure that fragile ecosystems, critical habitats and endangered species are protected from damage and plan for responsible mine closure.

10. Water, energy and climate change: improve the efficiency of the use of water and energy, recognizing that the impact of climate change and water constraints may increasingly become a threat to the locations where the miners and a risk to the license to operate.

In fairness many if not all these RGMP have been a matter of normal process for many miners for many years, but it helps to have them encapsulated and the bolting on of an Assurance Framewok is an additional support.

The Assurance Framework points out that the RGMP are intentionally designed to be demanding and that full implementation will take time. It is expected that an implementing company’s internal systems, processes and performance should conform with the RGMP by year three. In the first two years the implementing company should report progress and it is suggested that the report for Year 1 should confirm that a “readiness review” has been undertaken to determine compliance; and in Year 2 this should be continued but augmented with a statement of progress on developing the necessary internal systems.


Gold Mine Cart - Gold Mining Principles.
Gold Mine Cart – Image: Needpix.

Compliance must be confirmed annually, not just at the mine-site, but also at corporate, regional or country levels. The Framework gives very detailed guidance as to how the Assurance can be implemented, including a useful table showing examples of elevated risk indicators, as well as a list of existing principles and requirements, including technical mining standards as well as supra-national organization requirements such as the Voluntary Principles on security and Human Rights and the International Finance Corporation Performance Standards.

Finally, it is worth nothing that the Toronto Roundtable, for example, included individuals from academia, the investor community and civil society organisations. Perhaps, a key point is that legal compliance with Principle 1 is the very minimum. Further, there was clearly detailed scrutiny of the wording of all Principles, including “right-holders” as opposed to stakeholders, notably indigenously-owned land; this and other examples suggest that the Principles are more stringent than as originally drafted. So, while ten principles may appear to be over-arching and high level, the associated paperwork shows that there is a high degree of detail involved and they bring further clarity as to how achieve confidence in mining operations and responsible sourcing.

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