Holmes Institute HI6008 T2 2019: Mining Industry Literature Review

This literature review examines the trends in production and sustainability within the Australian mining industry. It addresses the research question of how new production trends contribute to sustainability. The review explores sustainable development theories, the influence of local communities, and various factors impacting sustainability, including demographic considerations. It further discusses the environmental impacts of mining, rent theory, and resource management, as well as the shift of mining activities to rural regions. The concept of responsible mining is defined, and the role of innovation in the industry is analyzed, including the views of different critics. The review concludes by examining strategies for maintaining sustainability and productivity trends within the Australian mining sector, referencing various studies and theories to provide a comprehensive overview.

Running head: BUSINESS RESEARCH- LITERATURE REVIEW
Business Research – Literature Review
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Table of Contents
Literature Review...........................................................................................................2
Sustainable Development and Sustainability.............................................................2
Local Community and their influence on Sustainability............................................3
Different factors influencing sustainability development in the mining industry......3
Impacts of the mining industry over the environment...............................................4
Rent Theory and theory of Resource Management in the Mining industry...............5
Products of the mining industry and its shift to the rural regions..............................5
What is Responsible Mining?....................................................................................6
Innovation in Mining and the views of different critics.............................................6
What should the mining industry do to maintain sustainability?...............................8
Productivity trends in Mining industry......................................................................8
Reference:....................................................................................................................10

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Literature Review
The mining industry has a long tradition in Australia, however the question of the
sustainability is still a matter of concern and is considered to be a difficult issue. The
research question that this study deals with is the evaluation of the trends in the production
and sustainability of the Australian Mining Industry. The prime research problem is that how
the new production trends in the Australian mining industry helps in the approach of the
sustainability criteria of the industrial sector of mining. The mining industry increases the
economic variability, with the help of the sustainable economic growth. There are a lot of
aspects and issues that are involved in accessing the sustainability of the mining industry.
Sustainable Development and Sustainability
There have been many theories that manyscientists have put forward deal with the
natural resources and the non-renewable nature of the mineral deposits. Mason et.al., (2014)
has discussed one of the exceptional theories about the sustainability in mining industry. He
says that the mineral depletion is associated with the sustainability and the sustainable
development. The researchers who study the mining industry discuss that the deposits of
minerals are limited. There should be constraints of the sustainable development theories so
that there could be limited mineral exploration and the production. This could be only
possible if the production is slowed down and there could be delay in the export quantity of
the mineral products and the mineral selling countries could slow down their selling capacity.
However on the other hand, Eklund (2015), argues that there is no sustainable operation
possible in the mining industry if the mining exploration and the production of the mineral
ores is considered to be exhaustion of the mines. There have been numerous industries who
have joined hands with the mining industries so that there is effective contribution to the
sustainable development. This would strengthen the association between the organisations,

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the industries ,, the society and the environment. According to Brueckner, Durey, and Mayes
(2013), in the recent years there have been a large number of firms have volunteered for the
sustainable development policies so that they could help to minimize the environmental
impacts of the mining as well as improve the social and the economic connections with the
stakeholders. Therefore, according to Lodhia and Hess (2014) there should not be any
perceived notion of sustainable development of the lifetime of mineral resources. It should
also not be considered as an unlimited source of wealth and profitfor a country. Essentially,
the greatest possible way is to eradicate the impacts that the mining has over the environment
in order to make sure that the public is potentially satisfied withother social incidents
Local Community and their influence on Sustainability
As discussed by Higgins, Milne and Van Gramberg (2015) the mining sector in
Australia has successfully created various impacts in the regions of Queensland, Australia.
The sustainability of the mining industry is indeed a question that needs evaluation, since it is
not clear how to increase the positive impacts from the mining within these regions. The
mining industry may be the dominant industry in the Australian local community as it
provides employment in the local community as well as it helps to increase the national
income. However the industry probably doesn’t enjoy the direct linkages to the local
community and its contribution to the sustainable development of the country is not that
sufficient. It depends largely on the resource industry.
Different factors influencing sustainability development in the mining
industry
According to other researchers and their study, the demographic factors of a local
community also influence the sustainability of a mining industry. The studies have showed
that there are differences in opinion of both the male and the female gender, regarding the

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attitudes, responsibilities and regarding the knowledge of the natural resources. The gender
divisions were also related with the race, age as well as the standards of income. Thus
according to Pokhrel and Dubey (2013) without considering the gender differences, in a local
community the understanding of the sustainability development in the mining sector is one-
dimensional. Roche and Mudd (2014) argues that in comparison to other natural resources,
there are other factors such as demographic factors that has an impact an individual’s chance
of backing a mining project in the region of their community. However only the demographic
factors have been brought t to the forefront and the other factors are still not researched upon.
Since the mining is a masculinised industry there is less opportunities for the females and
they tend to have less incentives to support the development of this industry. This might have
led to the decline in the sustainability for the mining industry. A similar scenario is prevalent
in Australia where the gender differences, the differences in the community and the power
relations are the major factors that help in the analysis of the sustainability of the mining
industry situated in Queensland.
Impacts of the mining industry over the environment
Contradicting to the benefits of the mining sector, according to a survey conducted by
Pokhrel and Dubey (2015) the reputation of the mining industry in Australia depends strongly
on the perceptions of the resources sector. The industry’s wealth is most importantly
associated with the self –interest and the power and influence. The profits that the production
of the mining industry and the resources sector generates eventually benefits the expense of
the rest of the country however at the cost of our own future. The mining activities are
extremely diverse and varied and they have a large ecological footprint, highlighting the
aspect of the sustainability development. The mining activities in the past have cost a lot to
the environment and have left several impacts and imprints over the environment. The two
particular issues that are of major importance involve the mine tailing s and the acid mine

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damage. The tailings involve the toxic elements which when released to the environment and
the biosphere affect it negatively. The exposure of the rocks and the mineral ore deposits to
the water and the oxygen is termed as the acid mine drainage. This facilitates the mobilization
of the chemical elements thus affecting the water and the food chain , and increasing the
concentration of the toxic elements there with dreadful effects over the human health and the
health of the ecosystem as well. The legacy of the mining has been carried forward since the
ages and this tradition had never been questioned. It was from the last quarter of the 20th
century that the sustainability of the mining industry and the effectsof the production have
been a major concern.
Rent Theory and theory of Resource Management in the Mining industry
Economic analysis of the mining industry includes the theories of the rent as well as
the resources. The first is the opportunity of the society that deals with the cost of the use of
the resources. The rent theory is the new competition between the land owners and the
deposit of the mineral resources. Along with this the problem that arises is that of the
management of the resources. The management of economic resources is essential if there are
problems of composing and acquiring mineral rent. This happens even when the procedures
and forms in which the rent is reflected in the price of mining products and energy resources.
In accordance with this the theory of the location is of major importance that influences the
mining industries.
Products of the mining industry and its shift to the rural regions
The production function of the mining which is capital intensive tends to constrict the
backward and the forward linkages of the local community. Therefore, according to Zhang
and Moffat (2015)the regional and local communities may tolerate severe environmental and
social costs with very limited compensation. However, mining companies do consider the
improvement of local welfare as a requirement for feasible investment. But there is a risk of

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moral hazard if there is an extension of their concern beyond their commercial permission so
improved authority is fundamental to securely boosting regional welfare. The mining
industries have shifted from the developed regions to the other local communities and the
rural regions. This is because of the side effects of the environmental legislation development
and the increased costs of waste management, the international companies in today’s market
scenario demand the productions of the mining industry. They often demand oil, coal,
minerals like uranium, and rare earth elements from these mining industries due to which
these industries are located in the regions apart from the urban areas. According to the study,
(Zhang and Moffat 2015) the mining industries are located in the remote areas of Australia
and they often have less stringent mining laws. The mining industries thus enjoy less
environmental regulations and in order to avoid the mining impacts and the adverse
environmental effects over the densely inhabited areas, they are transferred to the other
regions.
What is Responsible Mining?
According to Pokhrel and Dubey (2015) the term “Responsible Mining” is related to
components like; environmental responsibility, social responsibility. The Responsible Mining
assures initiatives towards obtaining profitable resource development. External factors like;
political shifts, modified rules, employee voice, modern technology are associated with
responsible mining. In addition to this, limited research work is founded on the association of
external factors and responsible mining incontext to the mining industry in Australia (Lala,
Moyo, Rehbach 2016).
Innovation in Mining and the views of different critics
According to Roche and Mudd (2015), since the sustainability is the prime concern
and a global trend, there has been a growing need for the innovations in the mining industry
of Australia. However as argued by Lala, Moyo, Rehbach and Sellschop (2016), there have

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been several reasons for the disconnection between acknowledging the need for innovation
and the acting on the previous legacy in a systematic way. One of the prime reasons in the
negligence of the innovative measure of the mining industry is the conservative nature of the
mining industry. Mining is integrally a risky business in terms of commodity price volatility,
uncertainty and physical hazards, both to the environment and the people. Therefore, some
companies are not willing to take on additional risk associated with innovation, especially if
it could impact the flow of cash or their licence to operate. However in contrast with this
negligence to innovation, Parham (2013) argues that there are positive signs in the mining
sector of Australia. The mining companies in the Australian sector have indeed realized the
need for a structured approach to the innovative methods and they have decided that working
with the other companies would be beneficial for them in deploying new ideas, to maintain
the sustainability which has been one of the major concern of the mining sector. As stated by
Parham (2013) there have been open industry forums along with the collaborative ecosystems
where the mining company is supposed to present a particular issue and the suppliers and the
other employees of the mining industry have to resolve the problems. There have been the
collaboration of the people, where they engage in collaborative software development
programs aiming at solving the growing problems. The mining innovation hubs have been the
new innovation of the Australian mining sector which helps in the collaboration of the
multiple stakeholders. They often involve the technology start-ups and the industrial leaders
find the solution to the different problems and the issues regarding the challenges of the
resources (Govindan, Kannan and Shankar 2014). In accordance with these innovations, the
mining companies also incorporates the various technologies and adopts them since these
technologies enable the mining industries to fight for the challenges of the sustainability and
they can deal with the international mining sector trends.

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What should the mining industry do to maintain sustainability?
As argued by Ivanova (2014), like most other firms, the mining industries’ prime
motif is maximisation of the profits anddisplay string competition among the other rival
companies in the international and national markets. In accordance with the goals of profit s,
there should be the goals of increased awareness of the environment and the socio economic
principles. All parties and the organisations that choose to maintain the guidelines of
sustainable development are expected to decrease the possibleimpacts of environment and
improve their relationships with the community and the stakeholder groups. These parties
should be satisfied with the commitment to sustainable development in the context of mining.
According to Bice (2014) the environment protection and the sustainable development is best
accomplished by the effective environment management policies. Required measures need to
be taken to stay away from any harm to the ecosystem. They should recognize the negative
impacts as well as the positives to the society beforehand. They should also decide how the
local people participate within the project of the mining industry. It is essential to see that a
mine is investigated in the most economic way, and if so, a mine has the ability to provide the
people with employment, local services and make some monetary donations to some
generousadministrations in the locality.
Productivity trends in Mining industry
Govindan, Kannan and Shankar (2014) argues that the productivity of the mining
sector has declined over the past decade, since the miners focus more on the output at any
cost and on the high commodity price. It is indeed difficult to determine the economic decline
of the mining industries, as well as determining the size of the industry is a major problem.
The productivity is the main challenge of the mining industries. The expected declines in the
labour, the capital and the decline in the material productivity is the main reason for the
decline. However another main reason is the decline in the economies of scale. Authors argue

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that the decline in productivity is a result of the large operations. It had been difficult to
manage the complexity of these large operations, particularly given the additional challenge
of high turnover and lack of staff experienced in focusing on driving efficiency. It had been
discussed by O’Faircheallaigh (2013) that integration is the prime challenge for the
production in the mining sector. The productivity is achievable if the workforce is
empowered and the culture undergoes a change. This would help to find out the solutions to
the existing problems of the decline of productivity as well as the sustainable development.
According to Mikesell and Whitney (2017), the use of technology can improve the working
practices. There can be proper and significant gain in the productivity if there is rethinking
how the work is being done, and by being prepared to look beyond the sector for better ideas.
Looking at disruptive innovation and opensource approaches (e.g., collaboration with
academia, suppliers and others) will also be required.

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Reference:
Bice, S., 2014. What gives you a social licence? An exploration of the social licence to
operate in the Australian mining industry. Resources, 3(1), pp.62-80.
Brueckner, M., Durey, A., Mayes, R. and Pforr, C., 2013. The mining boom and Western
Australia’s changing landscape: Towards sustainability or business as usual?. Rural
Society, 22(2), pp.111-124.
Brueckner, M., Durey, A., Mayes, R. and Pforr, C., 2013. The mining boom and Western
Australia’s changing landscape: Towards sustainability or business as usual?. Rural
Society, 22(2), pp.111-124.
Eklund, E., 2015. Mining in Australia: an historical survey of industry–community
relationships. The Extractive Industries and Society, 2(1), pp.177-188.
Govindan, K., Kannan, D. and Shankar, K.M., 2014. Evaluating the drivers of corporate
social responsibility in the mining industry with multi-criteria approach: A multi-stakeholder
perspective. Journal of cleaner production, 84, pp.214-232.
Higgins, C., Milne, M.J. and Van Gramberg, B., 2015. The uptake of sustainability reporting
in Australia. Journal of Business Ethics, 129(2), pp.445-468.
Ivanova, G., 2014. The mining industry in Queensland, Australia: Some regional
development issues. Resources Policy, 39, pp.101-114.
Lala, A., Moyo, M., Rehbach, S. and Sellschop, R., 2016. Productivity in mining operations:
Reversing the downward trend. AusIMM Bulletin, (Aug 2016), p.46.

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Lodhia, S. and Hess, N., 2014. Sustainability accounting and reporting in the mining
industry: current literature and directions for future research. Journal of Cleaner
Production, 84, pp.43-50.
Mason, C.M., Paxton, G., Parsons, R., Parr, J.M. and Moffat, K., 2014. “For the benefit of
Australians”: Exploring national expectations of the mining industry. Resources Policy, 41,
pp.1-8.
Mikesell, R.F. and Whitney, J.W., 2017. The world mining industry: Investment strategy and
public policy. Routledge.
O'Faircheallaigh, C., 2013. Community development agreements in the mining industry: an
emerging global phenomenon. Community Development, 44(2), pp.222-238.
Parham, D., 2013. Australia's productivity: past, present and future. Australian Economic
Review, 46(4), pp.462-472.
Pokhrel, L.R. and Dubey, B., 2013. Global scenarios of metal mining, environmental
repercussions, public policies, and sustainability: A review. Critical reviews in environmental
science and technology, 43(21), pp.2352-2388.
Roche, C. and Mudd, G., 2014. An overview of mining and the environment in Western
Australia. In Resource Curse or Cure? (pp. 179-194). Springer, Berlin, Heidelberg.
Zhang, A. and Moffat, K., 2015. A balancing act: The role of benefits, impacts and
confidence in governance in predicting acceptance of mining in Australia. Resources
Policy, 44, pp.25-34.