Use of Mining LPRM grows, 12 companies now onboard 

Mining Shared Value (MSV), a non-profit initiative of Engineers Without Borders Canada, has announced that 12 mining companies have now adopted the Mining Local Procurement Reporting Mechanism (LPRM), to report on a total of 34 mine sites across 19 countries.

The LPRM is a publicly available framework of 22 disclosures designed to promote and standardize information sharing on local procurement at the site level and aims to identify opportunities for improving transparency of spending, as well as policies and systems that support procurement from local suppliers.

“As demand grows for minerals required for the energy transition, mining sector procurement of goods and services has significant potential to drive economic and social impacts for mining host countries, and it can be instrumental in strengthening a company’s social licence to operate”, said MSV’s managing director, Jeff Geipel. “The Mining LPRM is a publicly available reporting framework that helps companies refine their approach to local procurement, and provides practical information to host country suppliers and other stakeholders.”

As procurement of goods and services represents the largest payment from a mining operation to a host country – often exceeding direct wages and taxes combined – local procurement can be a critical lever for the creation of short and long-term benefits in mining communities.

Ivanhoe Mines became the first company to implement the LPRM in 2019. Now a total of twelve companies are using it, including Freeport-McMoRan, New Gold, and Lundin Gold.

Beth Borody, VP sustainability at New Gold, stated, “We understand the importance of contributing to local economies and supporting local stakeholders. To understand more about our procurement practices, we started reporting against the LPRM, and were the first Canadian company operating in Canada to do so. Publicly disclosing our procurement numbers enabled us to have deeper conversations with stakeholders as well as review our internal processes for barriers and opportunities for improvement to improve our local procurement spend where possible.”

Solaris Resources is the first exploration company in the world to use the LPRM and reports on its Warintza project in Ecuador. Yasmin McDonald, manager CSR and sustainability, noted, “Effective and sustainable procurement in mining is critical; above all, at the level of exploration, it presents as an important opportunity to set the bar, promoting local businesses and provoking a multiplier effect related to local development. The LPRM has been the perfect tool through which to map Solaris’ progress in ensuring that we, as a mining exploration company, are committed to genuine local procurement.”

Earlier this year, Onyen Corp. also announced the addition of the LPRM to its ESG reporting software, offering user companies the ability to report in accordance with the disclosures, while eliminating duplicative reporting and centralizing data collection and management.

The LPRM encourages companies to disclose information on policies and commitments, spending on goods and services sourced from local suppliers, development programmes and support made available to local suppliers, as well as supply chain due diligence efforts. It is intended to satisfy the requirements of other frameworks as well, such as the World Gold Council’s Responsible Gold Mining Principles (RGMPs) and the Initiative for Responsible Mining Assurance (IRMA) Standard.

MSV's 51-page report about the benefits of local procurement may be downloaded by clicking here.