A snapshot of the role of investment managers

The mining sector naturally receives the most attention with regards to ESG, as mining companies are in close interaction with communities and have a lasting impact on natural resources. At M&G Investments, we leverage our global scale and local expertise to drive meaningful engagement with mining companies.

In South Africa, mining has been under pressure, with some of the challenges faced to increase volumes or mining output being structural in nature. Capital investment in exploration and greenfield projects is limited, while technological advances are needed to accelerate the role of platinum group metals (PGMs) in a low-carbon future. As our nation isn’t as well endowed with the commodities of the future, such as copper, we need to consider how we use what have today to build for tomorrow to support the sustainability of mining communities.

We have a shared responsibility as asset managers and asset owners to hold our investee companies accountable when it comes to ESG outcomes, to ensure that they leave something sustainable behind for their communities when they cease mining. As such, we monitor what they’re doing in terms of reskilling and training people, employing them within supply chains, fostering entrepreneurship in non-mining related activities, and growing other labour-intensive alternatives. Incentivising the right behaviour is key, such as linking remuneration to ESG outcomes, and we have these critical conversations with companies and boards on behalf of trustees or asset owners.

As long-term investors, there’s more to active asset management than alpha generation. At M&G Investments, we’re making sure that we’re investing in companies that are aware of their responsibilities towards their stakeholders. We’re committed to ensuring that the focus is on the transition being not only economically viable, but also socially responsible.