We are a global management consultancy that delivers exceptional outcomes and sustainable change

We are a global management consultancy that delivers exceptional outcomes and sustainable change


Chart­ing a pos­i­tive growth in the min­ing industry


In 2020, the top 40 glob­al min­ing busi­ness­es, which account for the vast major­i­ty of the industry’s rev­enue, gen­er­at­ed $656 bil­lion in sales. How­ev­er, the min­ing industry’s net prof­it mar­gin has declined from 25% in 2010 to 11% in 2020.

The min­ing indus­try is fac­ing many chal­lenges as the world moves towards more sus­tain­able sources. Demand for ‘crit­i­cal min­er­als’ (such as cop­per, lithi­um, nick­el, cobalt, and oth­er rare earth ele­ments) con­tin­ues to surge while oper­at­ing envi­ron­ments become more chal­leng­ing, and new play­ers emerge in this increas­ing­ly volatile and unpre­dictable sector.

Lead­ers across the min­ing sec­tor have had to reset their strate­gic objec­tives and pri­or­i­ties. A cen­tral nar­ra­tive emerged — the issue of trust. Min­ing com­pa­nies are now con­sid­er­ing what they should do to increase or rebuild trust among their ecosys­tem of stakeholders.

At the same time, the indus­try is also respond­ing with more fun­da­men­tal shifts to busi­ness and oper­at­ing mod­els. New busi­ness mod­els offer oppor­tu­ni­ties for min­ers to repo­si­tion for a chang­ing future, with many com­pa­nies con­sid­er­ing the ben­e­fits of strate­gies to ratio­nalise, grow and trans­form. Com­pa­nies that scru­ti­nize and shift busi­ness mod­els now can get an edge on com­peti­tors as demand and expec­ta­tions change.

How­ev­er, envi­ron­men­tal, social and gov­er­nance (ESG) relat­ed risks have quick­ly become a legit­i­mate busi­ness con­cern. Com­mu­ni­ty rela­tions and social license to oper­ate remain impor­tant issues for min­ing com­pa­nies. Envi­ron­men­tal risks, includ­ing new reg­u­la­tions, have also become more prominent.

How can min­ing nav­i­gate these imme­di­ate chal­lenges while pro­gress­ing their trans­for­ma­tion into purpose-led, low-carbon, dig­i­tal­ly enabled organizations?

How ESG in min­ing con­tributes to rev­enue growth

Min­ing com­pa­nies with high­er ESG rat­ings have out­per­formed the broad­er mar­ket. Dur­ing the peak of the COVID-19 pan­dem­ic, these com­pa­nies deliv­ered 34% aver­age total share­hold­er return over the past three years — ten per­cent­age points high­er than the gen­er­al mar­ket index.

Min­ing com­pa­nies are also lever­ag­ing on new tech­nolo­gies to improve their ESG per­for­mance and ulti­mate­ly deliv­er net pos­i­tive rev­enue growth for their share­hold­ers. For exam­ple, big data and machine learn­ing are being used to under­stand min­er­al diver­si­ty and dis­tri­b­u­tion, and dis­cov­er new, poten­tial­ly lucra­tive min­er­al deposits5.

Deliv­er­ing — and main­tain­ing — pos­i­tive rev­enue growth in mining

Min­ing com­pa­nies must assure the long-term devel­op­ment of its resources if we are to main­tain a com­pet­i­tive advan­tage for the indus­try. We can ben­e­fit from sus­tain­able devel­op­ment if we entice investors, avert project set­backs, improve tech­ni­cal progress, and strength­en local and inter­na­tion­al partnerships.

Some of the ways that this objec­tive can be achieved by min­ing com­pa­nies include:

  1. Pro­duc­tion increase
    Min­ing com­pa­nies can increase their pro­duc­tion out­put by invest­ing in new equip­ment, tech­nol­o­gy, or expand­ing their oper­a­tions. This increased pro­duc­tion can lead to an increase in revenue.
  2. Acqui­si­tion or merg­er
    Min­ing com­pa­nies can also record pos­i­tive rev­enue growth through acqui­si­tions or merg­ers with oth­er min­ing com­pa­nies. By com­bin­ing oper­a­tions, com­pa­nies can reduce costs and increase pro­duc­tion, result­ing in high­er revenue.
  3. Improved oper­a­tional effi­cien­cy
    By improv­ing oper­a­tional effi­cien­cy, min­ing com­pa­nies can reduce costs and increase pro­duc­tion out­put, result­ing in high­er rev­enue. This can be achieved by stream­lin­ing process­es, reduc­ing waste, or imple­ment­ing new technologies.
  4. Explo­ration and devel­op­ment
    Min­ing com­pa­nies can also gen­er­ate rev­enue growth by invest­ing in explo­ration and devel­op­ment activ­i­ties to iden­ti­fy new min­er­al deposits and bring them into production.

The Renoir advan­tage in mining

New tech­nolo­gies such as arti­fi­cial intel­li­gence, data sci­ence, and automa­tion are cre­at­ing inno­v­a­tive solu­tions that can opti­mise oper­a­tions. There’s an urgent need to adopt these tech­nolo­gies to dri­ve inno­va­tion and cre­ate mines of the future, but min­ing com­pa­nies face high costs and rocky imple­men­ta­tion initiatives.

Renoir has been work­ing with min­ing com­pa­nies to nav­i­gate this volatile envi­ron­ment by imple­ment­ing suc­cess­ful changes to oper­a­tions and build­ing capa­bil­i­ties that are cru­cial for them to thrive and suc­ceed. We achieve this through:

  1. Capex Man­age­ment
    We run pro­cure­ment spend­ing and diag­nos­tics to iden­ti­fy cost sav­ings on fixed assets across glob­al oper­a­tions. This includes sup­ply chain matu­ri­ty assess­ments (struc­ture, process, and sys­tems) to tar­get reduc­tions in the total cost of ownership.
  2. Per­for­mance Man­age­ment
    We estab­lish oper­a­tional KPIs to mon­i­tor and improve busi­ness per­for­mance through visu­al per­for­mance dash­boards, and review mech­a­nisms tailor-made for main­te­nance and sup­ply chain oper­a­tions. Addi­tion­al­ly, we also work with clients to estab­lish defined roles and respon­si­bil­i­ty state­ments such as RACI.
  3. Dig­i­tal Trans­for­ma­tion
    We sig­nif­i­cant­ly improve mate­ri­als man­age­ment and increase ser­vice lev­els using sys­tems and process­es already in use by the client, while at the same time reduc­ing work­ing cap­i­tal through inven­to­ry opti­mi­sa­tion. Our cross-functional skills in strate­gic sourc­ing, and ware­house and mate­ri­als man­age­ment through embed­ded ERP solu­tions will reduce work­ing cap­i­tal and asso­ci­at­ed oper­at­ing costs simul­ta­ne­ous­ly and sustainably.

If you would like to learn more about how we do this, please feel free to get in touch with us.

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