Tracking the 2016 Trends – Part 10: An expanded view of corporate and personal welfare

The final of the ten part series examining the trends that will define mining in 2016.

10. An expanded view of corporate and personal welfare: Safe, secure, and healthy

Safety should always be at the forefront of everybody’s mind in the mining industry, and every company is constantly working to refine their safety programs, driving down the potential for Lost Time Injuries (LTIs) and Lost Time Injury Frequency Rates (LTIFRs), which in turn lifts productivity.

This focus has helped mining achieve one of its safest years yet in terms of fatalities, although at the time of publishing the sector had recorded its first fatal incident.

In light of this push, miners have turned to data analytics to pinpoint potential industry risks, organisational behaviours, and internal cultures that may result in severe safety events, and implementing technology that allows them to implement employ safety programs focused not just on zero harm, but the goal of zero fatalities.

“Yet, despite this progress, industry risks related to both safety and security continue to grow,” Deloitte said.

However this is in part due to the widening scope for safety, as “leading companies realise that safety isn’t only a function of process-driven policies; it also requires the promotion of a culture of safety”.

“Embedded in that notion is the idea that employees must be both physically and mentally health for a safe and productive environment to flourish.”

Deloitte notes that there has been flagging industry health of late, in part due to the downturn, ongoing layoffs, and common mining conditions such as fly-in fly-out lifestyles.

However this has been noted by the Australian Government, with a West Australian parliamentary inquiry into mental health issues associated with fly-in fly out (FIFO) making several important recommendations after it found 30 per cent of the FIFO workforce was experiencing mental health problems, compared to a national average of 20 per cent.

The Education and Health Parliamentary Standing Committees examined the problem, focusing on ‘systemic issues’, such as the contributing factors leading to mental illness and suicide in FIFO workers, current legislation and policy for workplace mental health in WA, and improvements to current government initiatives.

The inquiry, in response to nine apparent suicides by FIFO workers in WA within 12 months, recommended developing a Code of Practice on FIFO work, addressing issues of rostering, the contribution of fatigue to mental health issues, and anti-bullying strategies.

Improved data on FIFO workers and reporting of mental health and suicide was recommended, along with the extension of occupational health and safety provisions to living arrangements. Long term research is needed on mental health and FIFO work, but the committee importantly noted that risks must be mitigated in the meantime.

Similar to other recent public inquiries on psychosocial issues at work (for example, the NSW legislative council inquiry into bullying at Workcover NSW and the CSIRO inquiry), the committee recognised the necessity for organisations to ‘own’ the problem to manage the risks.

In Canada, Vale has partnered with a local university to conduct a similar, three year research project to study and address the mental health of miners.

Yet, safety is not just a concern on the site, but also off it.

In recent years mining companies have faced increased risk to their staff and facilities from outside sources.

In the first four months of 2015, employees from at least three different mining companies were kidnapped and held for ransom, according to Deloitte.

In 2012, five Australian miners were stranded in Mali after they were caught in the middle of the country’s ongoing civil war, whilst in 2014 extremists in the country invaded the Taoudenie salt mine, forcing more than 800 workers to evacuate the site.

In 2013 Kyrgyz nationalists attacked Australian miner Manas Resources’  subsidiary office, ransacking and looting the building, whilst a Scottish welding supervisor reportedly barely escaped with his life after mocking the country’s national dish, comparing it to a horse’s penis.

“Safety security and mental health are all issues that go hand in hand with mining productivity,” Nicki Ivory, Deloitte Australia’s mining leader west, said.

“As our ability to analyse these factors becomes more operationalised, companies can begin making more serious strides to safe guard not only their physical assets, but also the health of their people.”

Security issues surrounding intellectual assets are also rising to the fore.

“As the Internet of Things evolves and network connectivity extends beyond the nuclear enterprise, miners find themselves facing unprecedented risks,” Deloitte explained.

“Cyber criminals engaged in corporate espionage, attempted blackmail campaigns or malicious efforts to cause damage by hacking autonomous vehicles (for instance) are using increasingly sophisticated tactics to target both organisations and individuals.”

Breaches have ranged from confidential data such as mining companies internal emails to state mining department resources such as when the NSW Department of Industry, Resources and Energy’s Maitland office came under attack in an attempt to access confidential resources commercial information, or in 2011 when hackers broke into Australian Federal Parliamentary email accounts to gain access to emails between ministers and Australian companies mining in China.

These hacking incursions came on the back of earlier Wikileaks releases showing BHP’s CEO at the time, Marius Kloppers, expressing his concern over Chinese surveillance and interference in BHP’s operations.

Earlier this year a Ukrainian coal miner was amongst a group of critical infrastructure operations targeted, with hackers introducing malicious codes into their industrial control systems which shut down electric distribution networks and cut power.

Miners have also been the target of less dangerous, but just as serious, cyber vandalism, such as when a Canadian gold miner became the latest target of hacker and digital activist group Anonymous.

Anonymous hacked BCGold’s website and defaced its website, rickrolling the miner by posting a video of 80’s singer Rick Astley’s hit ‘Never Gonna Give You Up’.

Unsurprisingly, Ernst & Young listed cybersecurity as one of the top 10 business risks this year.

“Cyber-hacking has become more widespread and sophisticated, with cyber-attacks being a common issue across the mining and metals sector regardless of size or scale,” EY said.

“Of course, not all cyber-attacks are for financial gain — hackers can be groups seeking to serve their own purpose.

“Being a victim of any form of attack can cost a mining and metals company millions of dollars in lost production, create health and safety issues on site, or cause massive reputational damage by leak of confidential/stakeholder unfriendly information.”

However, despite some knowledge of the problem, mining still lags in protecting itself.

“It is evident that cyber-crime is affecting the mining industry,” the regional director, ANZ, for WatchGuard Technologies, David Higgins, explained.

“Malicious network security events are growing in number as they prove to be effective business models for attackers. Mining executives have increased awareness of the benefits of establishing security infrastructure best practices as well as educating internal teams to minimise vulnerabilities and the risk of being breached.

“That being said, this awareness is still developing to a point of industry-wide understanding and willingness or ability to take action.”

EY’s Global information Security Survey 2013-2014 found that 41 per cent of the mining and metals survey respondents had experienced an increase in external threats over the past year, with 28 per cent experiencing an increase in internal vulnerabilities.

“Surprisingly, 44 per cent of the mining and metals survey respondents indicated that their organisations do not have a threat intelligence program in place and 38 per cent only have an informal one in place,” the report stated.

To overcome these physical, mental, and digital threats there are a number of strategies that can be implemented to protect workers and assets.

These include enhancing safety analytics and then correlating that data to identify safety incident patterns and workers at risk, and then in turn adopt processes and procedures to minimise the risk. Wearables can play a role in this data collection and reduction of incidents by tracking the location and physical health of workers.

Additionally, strengthening mental health policies as well as fostering a work culture focused on preventing the onset of mental health challenges, promoting recovery, and reducing the stigma attached to mental health problems will also lift safety.

In terms of physical assets, improved digital and physical asset security protocols – such as embedding tracking devices and even panic buttons on equipment – are lifting safety.

Deloitte also advocates employing risk monitoring, tracking ‘noise’ on the internet from hacktivist groups, nation states, and other threats to identify indicators of a possible attack.

“Whilst this type of monitoring cannot protect organisations from every unknown threat, it can helpl pinpoint dangerous situations before they escalate, enabling companies to detect, prevent, and respond to emerging risks.”

Finally, Deloitte recommended regular risk assessments as well as crisis management improvements, to mitigate associated security risks and understand how to effectively minimise damage by mobilising resources across the organisation when an issue occurs.

Rajeev Chopra, Deloitte Touch Tohmatsu’s global leader for energy and resources, summed up why the ten trends are important and must be understood as a whole: “Miners can no longer afford to look at mining trends and technologies in isolation.”

“As global economics converge, political, social, and technological changes increasingly impinge on how the industry operates. To find solutions we need to ask the right questions and be willing to consider unexpected answers.”

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