Potentials of business model innovation and values-based management approaches in the mining sector

Abstract

Mining is known to cause high ecological and social impacts especially due to its extractive nature on one hand and its resources and reserves mostly being located in developing or emerging economies on the other hand. Thus, it can be considered to have a paramount role in terms of making a significant contribution to sustainable development. Bearing in mind the growing economic output generated by humans and the growing world population, it is no wonder that related human-driven activities have never had such a strong (and at the same time burdening) influence on the biosphere resulting in exceedance of the planetary system boundaries. The critical reflection of the interaction between material cycles and economic growth is essential for reducing environmental burdens resulting from unthinking consumption patterns and production, and initial material extraction. The latest findings in academia confirm this assumption and point out that most practitioners are already aware of the urgent need for a redefinition of the sector’s understanding of success, taking into account the needs of both shareholders and stakeholders. Furthermore, the extractive sector has gained an image of being outdated. Agrowing number of decision-makers sees the necessity for a sustainable approach to business models that also embraces digitalization. The purpose of the paper is to analyze the standard business model that still dominates the mining industry, followed by a comparison of recent scientific findings on sustainability-oriented business model innovation and values-based innovation management to derive recommendations for potential sector-specific business model archetypes that contribute to the urgent redefinition.

Stakeholder integration in sustainable business models to enhance value delivery for a broader range of stakeholders

“…There is a consensus that BM innovation geared toward sustainability needs to incorporate the interests of a wide range of stakeholders in different kinds of businesses—including mining businesses—to combat the added social and environmental risks that are endured (Comin et al, 2020; Drusche & Krause, 2021; Dunbar et al, 2020). Understanding the interests of the respective stakeholders could also open a channel for mining businesses to uncover potential value co‐creation opportunities (Kurek et al, 2023) and increase their chances of securing a social licence to operate (SLO) (Bittencourt Marconatto et al, 2016; Comin et al, 2020; Poelzer & Yu, 2021).…”

“…In addition, mining companies run the financial risk associated with the pushback of mining operations by material stakeholders such as local communities (Dunbar et al, 2020). To minimise the risk associated with stakeholder dissatisfaction, it is then important to come up with recommendations for organisations that affect a wide range of stakeholders on how to integrate stakeholders in their value-creation processes (Drusche & Krause, 2021).…”

Gospodarka Surowcami Mineralnymi - Mineral Resources Management

“…The beneficiaries of changes in the approach to valuation are mining companies, including junior mines, whose strategic nature of operations requires a new focus for business models, which Drusche and Krause write about in their analysis (Drusche and Krause 2021).…”