Precious metals consultancy Metals Focus finds in its latest ‘Platinum Group Metals (PGM) Environmental, Social and Governance (ESG) Focus’ report that producers are increasingly strapped for cash to invest in these initiatives amid a lower PGM price environment and tighter margins.

The report contains comparisons of key ESG metrics across five major PGM producers, which account for about 85% of global PGM supply.

The producers are Anglo American Platinum (Amplats), Impala Platinum (Implats), Northam Platinum, Sibanye-Stillwater and Norilsk Nickel.

Notably, Metals Focus aims to examine how ESG strategies are evolving across the platinum mining industry and within individual companies, rather than draw comparisons among miners.

The consultancy reports that combined Scope 1 and 2 greenhouse-gas emissions from PGM mining companies remained flat year-on-year in 2023 at 22.82-million tonnes of CO₂ equivalent.

An increase in Amplats’ emissions of 5% year-on-year to 4.29-million tonnes of CO₂ equivalent, owing to energy inefficiencies caused by unreliable power supply from South African power utility Eskom, was offset by reductions in emissions at Norilsk, Sibanye-Stillwater and Implats, which have recorded shifts in energy consumption patterns.

In turn, water use by the companies in the report decreased by 9% year-on-year to 409 gigalitres in 2023, with 312 gigalitres having been drawn from natural sources.

Sibanye-Stillwater achieved the highest water recycling rate at 61% in 2023, supported by its closed-loop systems and targeted initiatives for water conservation. 

The PGM miners’ contributions to governments, including taxes and royalties, decreased by 30% to $5.3-billion in 2023, owing to lower PGM basket prices.

Notably, Amplats and Implats reported payments below $1-billion to governments for the first time since 2020.

Similarly, local procurement spending decreased by 1% year-on-year to $5.5-billion, largely owing to lower spending by Amplats and Norilsk, while Implats increased its procurement spending by 2% in the year to $1.5-billion.

The miners’ community development expenditure was lower, at $348-million, marking a 35% year-on-year decrease compared with 2022, with Norilsk’s spending, in particular, having halved to $205-million in the reporting year.

Metals Focus found that women's participation in the PGM workforce continued to grow across all companies, having reached an average representation in the workforce of 21% in 2023.

Additionally, all companies achieved board-level women representation exceeding 20% for the first time since 2020, which reflects progress in their diversity and inclusion efforts.

In particular, Implats’ women representation on its board increased from 47% to 54% in 2023, but Amplats recorded a reduction in women representation on its board to 25%.

“As the industry contends with lower PGM prices and tighter margins, cost-cutting efforts could jeopardise the survival of some operations. Enhancing ESG standards often require additional investment, which may be questioned under current economic pressures,” Metals Focus states.

The consultancy adds that PGM supply is becoming more competitive, with recycled PGMs anticipated to grow their supply share as vehicles with higher PGM loadings are increasingly decommissioned.

Growing focus on the circular economy, which is bolstered by EU regulations, could see the origin and environmental impact of PGMs becoming a more significant consideration for consumers, emphasising the need for strong ESG practices.

Metals Focus remains optimistic about the future of the PGM mining industry as it seeks to strengthen its ESG contributions. While challenges remain, the industry’s continued focus on ESG credentials offers a pathway to a more resilient and impactful future.