BNDES - Brazilian Development Bank
   




Socioenvironmental Policy for the Mining Sector

BNDES’s commitment to sustainable development is reflected in its Mission, Vision and Values and also in the set of policies, procedures and instruments that guide its actions.

With the objective of financially supporting sectors with the greatest social and environmental beneficial impact, the institution sets out specific policies, which adapt the general guidelines to the particularities of each activity.

In this context, the Socioenvironmental Policy for the Mining Sector formalizes guidelines and criteria that reinforce the granting of financial support to enterprises in the sector, in addition to transversal policies from the BNDES System and the legislation in force.

When considering and promoting the social and environmental performance of companies and enterprises, BNDES contributes to increasing the competitiveness of its customers and enhancing the sustainability standards in the sector. At the same time, BNDES promotes suitable conditions in terms of work, human rights and the social development of local communities, besides the preservation and appreciation of environmental assets.

Socioenvironmental impacts of the sector

Mining is an important and diversified industry, which provides resources that support socioeconomic development and that are indispensable for maintaining living standards and advancing modern societies.

Mining is defined as the extraction, preparation and processing of minerals found in their natural state, including the exploitation of underground and surface mines and all their complementary activities in order to prepare and process minerals in general, provided that they are made marketable, without causing irreversible change in the character of its primary condition.

Activities within the mining industry are complex and varied and, if not properly managed, can have a significant impact on the environment and surrounding communities.

Mining activities are associated with different socioenvironmental impacts, depending on their context and the way they are performed. Usually, in the current stage of technological development, the topics associated with mining materials include:

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Policy scope

This policy includes the set of activities required to obtain a raw mineral product, a concentrate or an agglomerate, which are schematically presented below.

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Guidelines, criteria and practices for the sector

The socioenvironmental analysis of clients and enterprises is performed considering the material issues of the sector and the specific characteristics of each project. Customers are expected to demonstrate their ability to deal with the major environmental impacts related to their project.

A minimum requirement for an enterprise to be granted financial assistance is providing evidence regarding compliance with applicable laws and regulations as well as, when applicable, submitting related documentation, such as environmental impact studies and related action plans.

Other socioenvironmental aspects are considered in the analysis, so that BNDES can create an effective risk management assessment or a strategy to induce better sustainability practices among its customers.

The following illustrated aspects are contemplated in the analysis for Brazilian mining enterprises:

  • Legal conformity: compliance with the rules and regulations of the jurisdictional bodies. Examples:
    • compliance with the National Department of Mineral production (DNPM);
    • compliance with the jurisdictional environmental bodies
    • in regards to diamond mining activities, compliance with the National Registry of Commerce of Diamonds (CNCD), linked to the Kimberley Process certification scheme; According to law No. 10,743/2003 and other applicable regulations.
  • Human Rights: acting in favor of human rights in the workplace and to relationships with the parties affected by the project, which includes providing suitable working and living conditions for the workers, ensuring that there is no child or forced labor or discrimination based on race or gender and making sure that the traditional communities and local groups are respected. These activities must be in accordance with the company’s human rights policy.
  • Health and safety for employees and the community:
    • existence of a health and safety policy and system for employees, including information disclosure and training for employees and subcontractors;
    • activities regarding education, health and the promotion of safety initiatives with the local community, including partnerships with government entities.
  • Environment: existence of an environmental management policy and system aimed at continuously improving the prevention and mitigation of adverse environmental impacts, including air quality control, water use and disposal management, waste storage and disposal, hazardous substance use, greenhouse gas emissions and biodiversity management.
  • Socioeconomic impacts in areas affected by mines:
    • Management of the relationship with the stakeholders:
      • participation of parties affected by the project, within the framework of the environmental licensing process;
      • appropriate procedures for dealing with population displacement;
      • mechanisms for forwarding demands to the company and practices related to transparency and accountability to the stakeholders.
    • Local development: proactive stance and commitment to local development, including:
      • participation in wide discussions with public authorities and other stakeholders, the purpose of which being to mitigate the social impacts of the enterprise;
      • performance of social investments aimed towards the community.
  • Planning and completion of the activities: presentation of the mine decommissioning plan and establishment of possible alternative uses for the rehabilitated area.

BNDES seeks to adopt an active engagement and constructive dialogue approach with customers in order to improve its social and environmental performance and contribute to high sustainability standards in the sector.

It is worth highlighting that the Bank has specific credit lines to stimulate social and environmental investment by companies.

Specifically within the mining industry, without compromising other internal regulations, BNDES offers no financial support in the following cases:

  1. Enterprises that incorporate rudimentary or unplanned mining processes; and
  2. mineral enterprises located within strictly protected areas.

BNDES encourages the application or participation of companies of the mining sector in the following initiatives related to best environmental practices, such as:

  • Extractive Industries Transparency Initiative – EITI;
  • Principles for Sustainable Development from the International Council of Mining and Metals – ICMM;
  • Voluntary Principles on Security and Human Rights from the United Nations.

BNDES also encourages a proactive stance in favor of developing and implementing safer and more efficient technologies regarding the consumption of energy, natural resources and other materials, offering differentiated conditions for this kind of investment, in accordance with their operational policies.

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