Sustainable Procurement in Mining

This report provides a comprehensive literature review on sustainable procurement in the mining sector, focusing on Australian practices and UN standards. It examines the environmental, social, and economic benefits and challenges associated with sustainable procurement in mining, analyzing relevant literature and highlighting key programs and initiatives. The report also explores the role of UN standards in promoting responsible mining practices and achieving sustainable development goals.

Sustainable Procurement
in the Public Sector

TABLE OF CONTENTS
LITERATURE REVIEW ...............................................................................................................1
2.1. Introduction.....................................................................................................................1
2.2 Sustainable Procurement in mining sector in Australia...................................................1
2.3. National Waste Policy Australia.....................................................................................2
2.4 Growing demand and Production volumes have boosted the Mining industry................3
2.5 Programmes launched by Australian Government for sustainable development in mining
sector.......................................................................................................................................4
2.6. Environmental and Social Impact of Mining Industry....................................................5
2.7. Sustainable Procurement in terms of UN Standard.........................................................6
2.8 UN Standards in mining industry.....................................................................................8
2.9. Benefits and challenges of sustainable procurement in mining......................................9
2.5 Environment Benefits.....................................................................................................10
2.6 Social Benefits................................................................................................................10
2.7 Economic Benefits..........................................................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

LITERATURE REVIEW
2.1. Introduction
This is the second chapter of the dissertation which is very important as it included the
authentic and reliable information. It provides the deep insight of the topic which contains a
critical analysis as well as the integration of information from a number of sources along with the
consideration of any gaps in the literature and possibilities for future research. It provides the
complete summary as well as explanation of the research topic. This present literature review
section will provide the detailed information of Sustainable Procurement in the public sector.
The main focus is on mining sector of Australia as well as sustainable procurement in terms of
UN standards. Researcher will formulate themes on the basis of research objectives and
information will be collected from authentic sources like books, journals, blogs, and internet
articles. Thus, with the reliable and reliable sources, researcher will maintain the reliability of the
research as well as study the depth of sustainable procurement of public sector in Australia.
2.2 Sustainable Procurement in mining sector in Australia.
According to Warner, Michael, (2016) sustainable procurement is meeting of needs of
business for materials, goods, utilities and services in an environmentally-friendly, responsible
and ethical way. It is the adoption as well as integration of Corporate Social Responsibility
(CSR) principles into the process and decision of procurement while also ensuring, they meet the
requirements of company and its stakeholders. It integrates the requirements, specifications as
well as criteria which are compatible with the protection of the society along with environment.
It is not basically about using illegal chemical or child labours which can damage the healthy of
people and environment, it is commitment of business that they will protect the environment and
society in any way and do not misuse anything from the environment.
However, Hamilton and et.al., (2015)stated that, mining and metals are essential material
for the functioning of modern societies and economic opportunities for resource rich countries.
There are various challenges and risk which is created by the process of mining for the well-
being of people and environment. At all stages of mining, effective management is required from
the exploration to its closure to consider social and environmental impacts. Australian
government is very serious about the environment sustainability which governs mining are often
made with little consideration of sustainability of environment and the well-being of affected
communities. Warner, Michael (2017) said that, there are many countries as well as
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communities often do not access the optimum economic benefits mining. Government might
lack the capacity to forecast returns from mining as well as negotiate taxes of mining. Thus, it is
very important to have the best policies and strategies to mining activities in terms of
sustainability. In 2003 to 2014, over $400 billion of resource projects were initiated in Australia.
The mining industry contributes to the GDP of Australia about 8 percent as well as around 60
percent of exports. Australia's has large supply of mineral, non-mineral reserve and hydrocarbon
which mining section extracts, process as well as sells.
As per the findings Hamilton, Ross and Andrew, (2016) In today's era sustainability is a
very important topic in public sector both in Australian standard and UN standard especially in
mining sector. Procuring sustainability in mining is focused on minimising the environmental
and social footprints as well as to raising the level of sustainability in Australia. Mining sector in
Australia are increasingly adding the aspects of environment as well as social in their policies
and strategic agendas. There are 405 total number of mines operating in Australia. Public sector
in Australia are operating with the principles of sustainable development like they are highly
concern with a healthy, strong society within the limits of environment as well as promoting
goods and services.
2.3. National Waste Policy Australia
However, Berry, (2016) extracted that, The government of Australia either state, territory
and local are emphasizing collaborative on the National Waste Policy. The aim of this policy is
to reduce the waste, optimum utilisation of resources in which a set of direction for national
action on the recovery of resources and waste for period to 2020. For example- In mining
industry in Australia, as government is highly concerned on the sustainable procurement as the
environmental and social impact of mining industry is highly affecting. There are three
categories of environmental impact such as water (toxicity and acidity, limited access,
sedimentation), land (Biodiversity, waster, level spillage by heavy metal) and air (Dust of mining
and blasting, use and emission of sulfate oxide and nitrogen oxide and Road dust). Further, social
impact included social economic, health & safety (number of deaths both on mine and road),
number of injuries (both at mine and road) and illness (cancer, HIV, respiratory issue), Quality of
life (Vibration, Noise and Visual impact on scenery). These are impact of mining industry on
social and environment of Australia.
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2.4 Growing demand and Production volumes have boosted the Mining industry.
As per the Martin and et.al., (2017) Over the five years, 2018-2019, growing economic
condition as well as higher domestic prices of gold have encourages revenue for the gold Ore
Mining sector. In Australia, gold ore mining is remarkable as well as established industry as the
growth strongly grow and develop from last few decades. The revenue extracted from mining is
about $ 18 bn and the annual growth is 5.7 percent in 2014 to 2019. About 16,500 people are
employed in Australia in Gold ore mining. However, Stark and et.al., (2015) articulated that, the
role played by mineral exploration sector is also incredible for the growth of Australia. About 60
percent of mineral exploration is spending in the cited country. The mining sector of Australia is
keep on the pace of growth and development. But Landrigan and et.al., (2018) stated that, there
extraction is associated with both opportunities as well as challenges. Today, the main concern is
to find the way by which the mining industry could promote sustainable development. Australian
government is highly concern about the growing issues from mining industry (Australia GDP
from mining, 2018). Current GDP from Mining in Australia increased to 36287 AUD Million in
the fourth quarter of 2018 from 35864 AUD Million in the third quarter of 2018.
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2.5 Programmes launched by Australian Government for sustainable development in
mining sector.
Pimentel and et.al., (2016) has founded, the total GDP contributed by Mining technology,
equipments and services (METS) sectors has developed and grown very fast. Government of
Australia has started many programmes which are related with Sustainable Development. These
programmes are specially for the Mining industry. The programme named, Commitment to
Community, is one of the leading programmes for controlling the waste from mining industry.
The centre of strategy of sustainability is the main focus of this program. However, Adler,
Mansi, Rakesh and Carolyn Stringer (2017) articulates, another programmes lead by government
of Australia is means, Closure of Mine and Environmental remediation. One of the great benefits
that modern formal mining brings is the so-called mine closure plan which serves to rehabilitate
the land used for the activities of mining once its operations are completed. Under this
programme, each and every organisation in mining industry have to give their commitments
before starting the mine. These programmes are developed for sustainable procurement of
environment and land.
4
Illustration 1: Australia GDP from mining
(Source: Australia GDP from mining, 2018)

Parker and Stephen, (2018) stressed on Jarrah forest of Western Australia, which is
famous for bauxite mining. 1.8 million hectares in which majorly are publicly owned as well as
managed as state forests of Jarrah Forest. Government of Australia begins the Rehabilitation of
Mines, it is the programme which is started for the purpose to give the land a use value greater
than or equal value that which have before the activities of mining. It is true that vegetation,
forests, radically change the landscape as well as entirely damage the ecosystem. Mining
activities also influences the outside of land by metals, chemical waste. Another program for
controlling the mining activities launched by government is Environmental Responsibilities for
mining industry and it is very popular programme which is started by Australian government. It
aims at controlling and helps to balance the planet. It is very important to practice sustainability.
2.6. Environmental and Social Impact of Mining Industry.
de Lange and et. al., (2018) identified that Mining industry uses sophisticated as well as
innovative technologies in management system, recycling, recovery, re-use and beneficial use of
water. It is very important that mining organisation should consider the environmental and social
impacts from its exploration stages to its closure. Australian government has set principle for
public sector organisation that needs to be followed in any concern like adopting strategies in
order to avoid UN-necessary consumption as well as manage demand such as water and energy.
Businesses should give fundamental consideration to those goods, services and infrastructure
which can be repaired, recycled and reused. Businesses has to minimize the environmental
influenced over the life of the products and services by choosing the those goods and services
which have lower impact on the environment or society. In addition to this, organisations must
conduct ethical practices which are applied and the suppliers are complying with socially
responsible practices which indulges legislative obligations to staff members.
Hancock and et. al., (2018) stresses that, the concept of sustainable procurement is
mainly relevant to public sector organisations is to bring improvement in the efficiency in the
money spent by the public whereas at the same time using market power to bring about major
social and environmental advantages, globally, nationally and locally. Australian government is
very concern about the health of public as well as environmental sustainability. Fordham, Anne
and Guy, (2018) argued that Australia is leading in innovation and early adopted of changes but
in ethical and sustainable procurement country is legging behind as compare to United Nations.
Public organisations emphasise on product stewardship as well as the end of life strategies but
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targeting procurement and ethical practices seems to have slipped through cracks. For example-
the case of the public sector of United Kingdom, the government of UK has committed to make
sure the ethical and sustainable practices is strictly embedded specially within public sector.
Government has introduces the Slavery Act making an offence for all British firms in order to
procure goods arising form servitude, exploitation, forced labour, slavery. This shows that how
the government is taking the practices or operations of businesses especially public sector very
seriously.
De Bellefroid and et. al., (2017) inculcate that the situation of sustainability and ethical
practices are very disappointing as still it need to understand and make ensure through
procurement professionals specially in the selection and management of suppliers in mining
industry. It is very important that government of Australia requires buy-in support of
organisation in order to embed a policy of sustainability in products and services that also
indulges capital projects in order top drive Environmental Sustainable Design (EDS). Further,
the role played by public sector organisation is excellent as they took initiatives to reform the
policies in order to maximise the benefits of mining sector as well as overcome the impact on
environment and society. Within procurement process, the mining sector involved in supply
management profession are continuously induced towards making momentous contribution
towards sustainable development in which they tend to address the growing degradation of
environment, climate change and resource depletion and all other issues which are effecting the
society.
2.7. Sustainable Procurement in terms of UN Standard
As per the findings of Renukappa and et. al., (2016)., The UN operates to accomplish
equality, goals of people, sustainable development as well as dignity of humans. The operation
of UN in terms of sustainable development is very incredible as the manner in which it manages,
procures and operations must indicate reflect these goals by rendering crystal clear signals to all
the businesses in favour of innovation, sustainability as well as more socially accountable goods
and services. As per the UN standards, Procurement is known as sustainable when it is integrated
specification, criteria and requirements which are compatible as well as in favour of
environmental protection, social progress and well-being as well as support the development of
economy. They also focused on optimum utilisation of resources and amendments in the quality
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of goods and services. Jomo and et. al., (2016) argued that, sustainable development as per the
UN standard is not only budgeting the market with newly added requirements instead it is well-
defined strategies which gradually phases in the requirements of sustainable development in bids
and tenders, promotes scripts as well as wide-open communication between procurers and
suppliers.
Diaz-Sarachaga and et. al., (2017) said that the United Nation sustainable procurements
provides criterion which outlines the roles of businesses and states addressing the adverse impact
of operations of business on environment and society. It is the duty of state to take legal actions
in order to protect the environment and rights of humans, whatever the business in, either mining
or any others. As per the UN standard, public sector organisation is guided by the transparency
principles in mining industry. They have to disclose each and every thing like safety disclose,
resources used, energy used along with the actions to overcome the adverse impact of operation
in environment and society. There are several tools or instruments in global environment law
which are context to regulations of environment specially in mining industry as it includes
conventions as well as treaties on quality of water, mineral waste, preservation of nature,
biodiversity, change in climate and air pollution.
Aktin and Zeynep (2016) said that, sustainable procurement as per UN standard ensure
the core values of the business integrated through the supply chain of the company into the life
cycle of the products and services of company. The main aim of sustainable acquisition is to cut
down the harmful or adverse impact of purchased goods and services throughout life of
businesses or industries. Sustainable public procurement is guided by the principles of
accountability, corporate governance and transparency. While emphasizing on the sustainable
procurement in the business organisations it has been mostly observed that the possible scope of
the concerned aspects has not been strongly represented in terms of policies or frameworks.
As per the findings of Reisch, Lucia, (2016) UN has developed some strategies for the
procurement of environment and human rights in 2015 to 2017. The first strategy which is
developed in incorporating the criteria of sustainability in the organisation buying evaluation.
With the strategies organisations will operate and functions as per the criteria. Another strategies
is to develop the mechanism of monitoring as well as assessment in order to promote compliance
of vendor in the supply chain of United Nation's development procurement. UN standards also
encourage businesses to use innovative technologies like Crown sourcing, pilot innovating
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techniques and functional specification. However, UN standard consist of highly transparent as
compare to Australian standard for sustainable development.
2.8 UN Standards in mining industry.
According to Yu and et.al., (2017) United Nation is also highly concern about the
sustainable development of the country. International council on metal and mining has
announced requirement of new membership in order to advance the sustainability performance of
the mining industry. It has committed members in order to implement the principles of guiding
rights of humans and businesses of United nations. United Nation has launched 17 sustainable
development goals (SDGs) in 2015 with the aim to raise the well-being of environment and
humans. Shvarts and et. al., (2017) stated that, UNECE encourages responsible mining part of a
green economy through a range of largely separate sectoral activities. Mining is one of the
thematic issues which is addresses by the forth and final meeting of regional implementation on
sustainable development in 2009.
As per the views of Ilankoon and et .al., (2018) The framework of United Nations for
resources is a comprehensive instrument for coherent as well as consistent classification along
with sustainable management of all the resources of energy and mineral. Minerals, uranium,
petroleum, geothermal and thorium all are included under this framework. They are dealing with
the key challenges such as waste issues, declining productivity, management of externalities,
rendering technology innovation, mounting waste issues, rendering social advantages in the
society and many others. However Skorstad and et. al., (2018) said that, UN standards is
focusing on Zero waste strategies for mining industries. Government is emphasizing on recovery
of waste as well as utilisation of tailings and mining. This approach has bring massive change in
the manner material flows through society resulting in no waste. There are many other nations
which are adopting the the policies and strategies of UN standard of mineral sector. Franks,
Daniel (2015) argued that, it is not possible to for any mining industry to decreases there waste to
zero level, minimisation is possible, elimination in impossible. This strategy is not up to the mark
because it is legging in relevancy.
Ranängen, Lindman, & Ejdemo, (2017) stressed over the other mining strategies and
policies lead by United Nations. Green mining is another strategies and approach which is aims
to to the best technologies, best practices that are implemented with the purpose to minimise the
impact of waste of environment connected with the extraction as well as processing of minerals
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and materials. The emission of carbon is also controlled with these strategies and approach of
United nations. From the popularity of these approaches, many other counties like Africa,
Sweden, Finland has adopted the approach of United Nations. Franco, Isabel and Saleem Ali
(2017) opposed that, still, these strategies and approaches are not able to eliminate the carbon
emission and proposed green mining. Still the carbon emission is 40 percent from the mining of
coal. It is very important that all these thing should be reliable. Author suggest that there should
be standard or level so that the outcomes could be measure. It is a smart solution but relevance is
very less in this approach.
According to the Böhling and et.al., (2017) Government and mining industry has
established an intergovernmental panel on mining as well as sustainable development. The
opportunities and threats for sustainable development posed by mining sector need to be more
balance standing body symbolizing all solicitous sectors to work within independent structures of
monitoring in order to present and disseminate in a crystalline manner more data on the critical
issues concerning from the extraction of mining. However, Tolonen, Anja (2018) articulates that,
UN has developed Best Practice Guidance on Effective Methane Drainage and Use in Coal
Mines. In this principles there is clear guidelines that supports development of safer as well as
more efficient practices in extraction of minerals from mines. However, as per the views of
Azadi and et.al., (2019) In 20th century, the extraction of construction of mineral will grew by a
factor of 34, whereas that minerals as well as ores has grew by a factor of 27. This development
importantly outpaced a multiplication of world population as well as 24 fold raises in the GDP of
United Nations. Thus, UN standard is emphasizing as well as boosting the production by
maximising economic and social advantages by addressing the negative impact on social and
environmental aspects in the interest of sustainable development.
2.9. Benefits and challenges of sustainable procurement in mining.
According to the de Lange and et.al., (2018) sustainability is a big word which have both
challenges and benefits. Today, all companies of all the sectors not only mining are very much
aware of the green procurement practices with the purpose to minimise the negative
environmental influenced. Sustainable public procurement is not only limited to deal with
aspects of environment and society but it aims at broader perspective where the economic as well
as social magnitude are included as well. Organisations are focusing on sustainable development
because they know the impact of negative PR on the media. It is very important for all
9

organisation to look after the sustainable procurement practices in the economy. The process
through which industries purchase asserts, services or suppliers by taking into accounts a number
of elements including consideration of value like quality, price, functionality and availability,
complete life cycle of products, environmental aspects, social aspects and recycled materials. By
this process the aspects of transparency is occurred. Adjei-Bamfo and et.al., (2019) there are
some challenges too which are faced by the mining industry in practising sustainable
procurement like recycling affects the quality, society expectation, air pollution, water pollution
etc.
2.5 Environment Benefits
As per the views of Pimentel and et.al., (2016) there are some environment benefits by
sustainable procurement in the mining industry like long term efficient in savings, optimum
utilisation of natural resources as it is very important for next generations. If all the resources are
depleted than it is not possible to secure for the next generation like resources which are non-
renewable. Söderholm, Patrik, and Nanna Svahn (2015) argued that, mining industry faces
challenges in procurement of sustainable practices as recycling and using of resources reduces
the quality and power of the resources. Recycling is possible to only some extent. So, it is best
that there should be balance in between the usage of resources. Further, the emission of gasses
from the procurement of goods and services with fever footprints of environment during there
life-cycle. There are many gases which are released by the exertion of minerals that put pressure
on the surface of earth. Another benefits is usage of water through needs in saving of water
HVAC equipments. Sustainable development also brings efficiency in energy as well as usage of
resources with the supervision and monitoring of the usage of chemicals and limiting the use of
toxic substances.
However the Milanzi and T. Bond-Barnard (2017) identified that, the waste exerted by
mining industry is very huge so with the sustainable procurement, is is beneficial thorough
procuring process that generate less waste. Both UN standard and Australian standards have
organised some programmes and approaches for dealing the waste management and overcome
the negative impact of mining waste on environment.
2.6 Social Benefits
As per the findings of Luttenberger, Axel and Lidija Runko Luttenberger (2017)
sustainable development contributes social sustainability on domestic as well as global level.
10

Social needs are very similar for the procurement of sustainable public. At domestic level it may
leads to improved the labour market through requirements on social and employment integration.
In addition to this, society also needs healthy environment, so sustainable development is very
beneficial for the society and community. Public acquisition may improve the situation in global
level specially concerning production a third nation through requirements on conditions of
working. Adjei-Bamfo and et.al., (2019) argued that, challenges to green management and
practices in mining industry is one of the challenge which is faced in the procurement of
sustainable practices. Air pollution is one of the biggest challenges that is not able to eliminate in
any concern as it could be eliminated by the shut-down of mines because with the excretion of
minerals, gases like Carbon Dioxide and Methane is released which is hazardous to the heath of
society. Thus, it becomes very challenging for mining industry to overcome the issues of air
pollution. Warner, Michael (20107) stated that, water quality is one more obstacles which is
faced by the mining industry as it oppose the social responsibilities. Waste water, underground
mines and drainage from surfaces are major sources of water pollution. This water pollution is
very harmful for society but it cannot be stop.
2.7 Economic Benefits
According to the Ranängen, Helena, and Åsa Lindman (2017) sustainable development
leads to savings for both society to the great extent as well as procuring industries which is
mining. By following the sustainable practices, it attracts the investors, minimise the regulative
penalties and fines as well as minimise the wastage that automatically is generate economic
benefits. At the same time, sustainable procurement practices also minimise the risk of
environmental degradation, healthier working environment and environmental accidents which is
also a economic benefits. Thus, sustainable development is very important for the growth and
development of nations both directly and indirectly.
CONCLUSION
The above literature review section comes to the conclusion that sustainable procurement
is meeting of needs of business for materials, goods, utilities and services in an environmentally-
friendly, responsible and ethical way. Further, the Mining industry uses sophisticated as well as
innovative technologies in management system, recycling, recovery, re-use and beneficial use of
water. Moreover, the sustainable development as per the UN standards and Austrian standards in
respect to mining industry was also included in this narrative reviews.
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