Project Calculates the Cost of Social Conflict
Publisher: Columbia University
Author(s): Madison Condon
Date: 2016
Topics: Extractive Resources
One of the significant water-related risks to investment in the mining industry, particularly in non-OECD countries, comes from social conflict and political uncertainty.
The Columbia Water Center is undertaking a three-year project to quantitatively assess mining-related water and environmental risks and their financial implications. This research is generously supported by Norges Bank Investment Management.
In Peru, for example, protests over potentially endangered water supplies have regularly brought operations at the Yanacocha mine to a halt for weeks at a time. Accounting for this uncertainty in a financial model is a challenging endeavor. There is a growing body of literature that has attempted to quantify the cost of conflict to the industry using various approaches.