More than 80% of employees at Gold Road Resources, Australia’s newest mid-tier gold producer, are accredited as mental health first aiders while the Perth company last year rehabilitated twice as much land as its exploration activities disturbed.
In another sign of Gold Road’s (ASX: GOR) maturity from high-hopes explorer to dividend-paying responsible miner, the company this week published its first-ever sustainability report.
The release of the report, focused on activities in 2020, complements the earlier-released 2020 Annual Report and comes less than eight years since Gold Road discovered the world-class Gruyere gold deposit in WA’s north-eastern Goldfields – and within two years of the resultant Gruyere gold mine producing its first bullion bar.
As far as milestones go, releasing a maiden Sustainability Report is celebrated more enthusiastically internally than by external stakeholders.
Indeed, there was more public anticipation leading up to Gold Road’s declaration on March 10 of a maiden dividend – a fully franked final return of 1.5¢ per share, payable on April 14.
However, this ignores the increasing ground-swell from investors – especially at the top end of the capital markets tree – demanding that companies they invest in demonstrate credentials around environment, social and governance (ESG) criteria.
The jury is out on how true the world’s largest investors are to marrying up an investee company’s ESG credentials with financial returns before making a final investment decision.
You just have to look at the response from the largest investors to corporate crises – too often, the financial rather than ESG impact seems to dominate the fund manager’s decision.
But the importance of ESG is undisputed and will only continue its ascendancy towards key decision-making status, which is why it is important for emerging blue-chip stocks like Gold Road to report on their sustainability credentials.
In employment terms, Gold Road is a much smaller company than its $1 billion market capitalisation – and half-share of the world-class Gruyere gold mine with average annual production of more than 300,000 ounces – suggests.
Gold Road’s 50-50 Gruyere joint venture partner, Gold Fields, operates the mine so those activities are largely excluded from Gold Road’s sustainability record.
Gold Road’s 2020 Sustainability Report paints a picture of a company with 69 employees, of whom 30% are women. One-third of Gold Road’s board members are female while women make up 7.2% of the company’s leadership team.
More than four in five employees, or 81%, have completed mental health first aid accreditation while Gold Road said it received favourable responses to its COVID-19 management from 95% of employees.
During 2020, Gold Road put its employees through 3666 hours – or on average 53 hours per person – of learning and development activities ranging from vocational training to education leave and course participation focused on topics as diverse as environmental management, four-wheel driving, cultural awareness and heritage management and working at heights.
Alongside its 50% non-operated stake in Gruyere, Gold Road’s principal activity is exploration in the broader Yamarna Greenstone Belt – which also hosts Gruyere. In 2020, Gold Road’s exploration team disturbed 106 hectares across its 450,000ha tenement area but in parallel rehabilitated 211ha that included land disturbed in previous years.
A solar-power system has been installed at Gold Road’s Yamarna exploration camp, a small but important steps towards reducing the company’s carbon footprint.
Gold Road has a policy of investing locally wherever possible and, in 2020, 7.4% of its $31.8 million supply chain expenditure was spent in the Goldfields region and 75.9% in broader Western Australia. The figure was marginally lower than the 2019 splits.
Gold Road also highlighted figures from the Gruyere mine (on a 100% basis) that included a $281.8 million procurement spend in 2020, of which 99% was in Australia including 12.8% with businesses based in the Goldfields.
Sustainability report figures are not always easy to compare company to company – however, that is not necessarily the role of these ESG reports. Rather, it is to confirm to investors that the company in question takes its ESG responsibilities seriously and has invested in the measures and data to be able to quantify its activities.
Also this week, the dual-listed Kirkland Lake Gold (ASX: KLA) published its Global Sustainability Report.
Kirkland Lake operates the Fosterville mine in Victoria – one of Australia’s top 5 gold operations – as well as assets in its Canada home base.
As an international operator and employer of 4290 people (including 900 in Australia), comparisons to Gold Road are largely irrelevant.
But on a few levels they make for interesting reading.
About 10% of Kirkland Lake’s workforce is female and 25% of board members are women. Kirkland Lake spent more than 80,000 hours on employee training in 2020, equivalent to about 20 hours per employee.
In terms of total supply chain spend, Kirkland Lake says it invests 76% in its Victoria and Ontario (in Canada) regions.
As a measure of water efficiency, Kirkland Lake says it recycles 70% of water volumes used.
All of Kirkland Lake’s sites are covered by biodiversity plans.
Back in Western Australia, Gruyere is also covered by a biodiversity plan while Gold Road last year produced an environmental awareness handbook that captured and provided information relevant to environment features and conservation priorities across its Yamarna exploration area.
