Barrick Gold chief hits fund managers over new-found social focus

Section:

By Neil Hume
Financial Times, London
Wednesday, February 5, 2020

https://www.ft.com/content/51c3cfe4-473f-11ea-aeb3-955839e06441

CAPE TOWN, South Africa -- Mark Bristow, the tough-talking boss of Barrick Gold, has lashed out at the fund management industry and its new-found focus on social and ethical investing.

Speaking at a major mining event in Cape Town, Mr Bristow questioned why some of the most profit-hungry asset managers in the world were now refusing to invest in businesses that did not have satisfactory environmental, social and governance criteria.

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"Even late capitalism's supposedly unvarnished practitioners have suddenly discovered the merits of a social conscience and are now saying they won't invest in a business that doesn't have a satisfactory ESG," Mr Bristow told the Investing in African Mining Indaba in Cape Town.

"To those people I say ... welcome to the club. I have been arguing for a long time that a good business also has to be a good citizen particularly in emerging countries," said Mr Bristow.

Barrick is the world's second biggest gold producer with operations that span the globe. Mr Bristow, a South African geologist, took the helm of the company a year ago.

Mr Bristow said Randgold, the Africa-focused gold producer he founded and sold to Barrick in 2018, had demonstrated the "critical" importance of investing and working to earn a social licence to operate.

He pointed out that ESG metrics had been around for a while under other names, such as corporate and social responsibility.

"Essentially ESG measures the impact these factors have on a company's ability to sustain its business in the long term," he said. "Its significance is that it has recently become a key investment criteria."

The growth of passive investing has forced active fund managers to find new ways to attract investor money and ESG-focused investing has been one way they have been able to fight back.

In a wide-ranging speech, Mr Bristow also said poverty was a bigger issue than climate change, adding that it was ludicrous that countries in Africa were facing pressure to cut carbon emissions when they produced a small percentage of the global total.

Mr Bristow also turned his fire on the World Bank and its efforts to try to regulate illegal, or artisanal mining.

"We have got this thing with the World Bank that walks around trying to encourage what they call indigenous mining. But it's not. It's illegal. It is exploitative, it damages the environment, its does not create jobs and it exploits child labour."

Mr Bristow questioned plans by the Democratic Republic of Congo to create a state-owned company to buy all the cobalt mined by hand in the country.

"Now there's a question of processing that cobalt in a central plant but no one is asking how that is going to be mined," he said.

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