Rio Tinto, one of the world’s largest, oldest, and most powerful mining companies, is fully on board the climate-change bandwagon.
The corporation announced that it plans to achieve net zero greenhouse gas emissions by 2050, largely thanks to pressure from the investor group Climate Action 100+.
A conglomerate based in the United Kingdom and Australia, Rio Tinto plans to first cut emissions 15 percent over the coming decade, and invest around US$1 billion by 2025 to figure out ways it can do more.
In doing so, the mining giant has lined up on the side of opposition parties in Australia and against the conservative Australian government.
The former are pushing for legislation on the net zero target, but the latter are staunchly opposed to such efforts to combat climate change.
For its part, Rio Tinto is able to make changes such as converting its mining operations partly to solar power.
For one Australian mine, the substitution of solar power for gas power resulted in a 3 percent decrease in emissions.
Jean-Sébastien Jacques, Rio Tinto’s CEO, is a firm believer in climate change, and like the leaders of other mining and metals companies, is trying to move a key industry to make the changes necessary.
Climate-concerned investors are part of the reason.
But he stresses that while his company can de-carbonize its own global operations, it does not have the power to do so along its entire supply chain.
Rio Tinto did announce last year that it is entering into collaboration with China Baowu Steel Group and Tsinghua University to “develop and implement new methods to reduce carbon emissions and improve environmental performance across the steel value chain.”
Making steel emits up to 9 percent of the world’s total carbon emissions each year.
Rio Tinto, provides the iron for this — but not the fuel, which is derived from coal, a high-carbon fossil fuel.
“The challenge for the world, and for the resources industry, is to continue the focus on poverty reduction and wealth creation, while delivering climate action,” says Jacques.
From his viewpoint, at the helm of a company providing a significant portion of the world’s metals to the market, he says that decreasing both consumption and economic growth are mandatory.
Shareholders as well as consumers, he says, will need to pay more and earn less in return.