The Power of the Board: How Mining Leaders Are Changing
Kim Greenock, Managing Director Australia & New Zealand, Davey Bickford Enaex
An old proverb says that vision without action is a daydream, while action without vision is a nightmare. For so many METS and mining companies, this relationship between action and vision is driven in large part by a board of directors. These are the folks who provide executive oversight, making high-level decisions that steer a company toward long-term health or decline.
In some cases, the board acts in a way that lacks vision, or adopts a vision without taking action. It may be difficult if not impossible to cite specific examples – but people in all corners of the industry have seen it happen, and the problem is becoming more noticeable as the need for meaningful change reverberates throughout the industry.
In its 2018 report on mining trends, Deloitte dedicates several pages to this topic. Whilst the analysis is not backed by heavy-hitting statistics on board compositions, a few common pitfalls are described – namely a lack of inclusion, myopic and stubborn viewpoints, and the tendency toward risk-averse governance.
It’s worth pointing out that historically speaking, our industry has good reasons for being risk-averse. Extracting ore is a heavy physical process driven by market demands that fluctuate ceaselessly. Board members and executives want their operations to be predictable and consistent, which often means doing things the way they have been done before. It’s easy enough to cast aspersions on leadership when conditions are tough.
Risk-aversion is a new kind of risk, however. Increased pressure from governments and communities is now coupled with the growing technical challenges of receding surface deposits – in addition to higher standards of environmental stewardship.
The question is, how can a mining or METS company effect change at the ground level if its board of directors are not actively engaged with the present realities of the industry? How often does the board, driven by a narrow fiduciary view of its role in the company, produce actions that are not informed by the appropriate vision?
One of Deloitte’s talking points around board activity is the need for new and expanded skillsets. If members are not technologically literate, for example, it can be difficult to fathom new operational challenges and potential solutions – such as digital blasting for downstream efficiency and vibration control, or IoT setups for real-time equipment monitoring.
Aside from technology, there is a need for clearer perception in the areas of human resources, talent management, social license, and environmental stewardship. A recent poll of mining managers conducted by Mining People International found that 82% were having trouble filling vacant positions. We’ve been hearing about a skills shortage for some time, and now the realities are beginning to pinch. It only makes sense that all of the various dynamics around talent acquisition/retention, succession planning, staff incentive, and work culture need to be thoroughly analysed and understood at every level of governance.
All of this may sound like a stretch from the standpoint of a traditional board of directors, but the truth is that none of the operational factors mentioned above are separate from a company’s financials. The new realities of our industry will, in the words of the Deloitte report, “require board members (who are) capable of imagining a new future rather than adhering to the practices of the past.”
At Davey Bickford Enaex, it’s our job to challenge assumptions around digital blasting and delivering value today and tomorrow. We do that with technology, expertise, and demonstrable results – but digital blasting is only one component of a healthy, forward-thinking organisation. It’s up to each of us to challenge our internal assumptions, and to cultivate a fresh mindset in the boardroom, so that vision and action can work together.