Mining and Quarrying Sector

Sector Definition and Scope

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The Mining and Quarrying sector corresponds to NACE Rev. 2 Section B in the European statistical classification system. It includes extraction of naturally occurring minerals in solid, liquid or gaseous form and covers coal and lignite mining, crude petroleum and natural gas extraction, metal ore mining, other mining and quarrying, and mining support service activities. In the EU, the sector had approximately 17,000 enterprises, employed 371,000 persons, and generated €64.1 billion in value added in 2022. Turnover reached €173.6 billion in 2022, before declining to an estimated €126.5 billion in 2023 after the exceptional price effects linked to post-pandemic demand and Russia’s war against Ukraine moderated. 

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Mining and quarrying is a strategically important sector because it supplies metals, industrial minerals, aggregates, fossil fuels and critical raw materials required by construction, manufacturing, energy, transport, defence, digital technologies and clean-energy systems. At the same time, it is one of the sectors with the most visible environmental and social impacts, including land disturbance, biodiversity loss, water stress, tailings risk, greenhouse gas emissions, occupational health and safety risks, community impacts, resettlement, human rights risks and governance challenges.

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Strategic Sustainability Context

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The sustainability profile of mining is shaped by a structural tension: the world needs more minerals for electrification, batteries, renewable energy, grids and digital technologies, yet mineral extraction itself can create significant environmental and social harm. The International Energy Agency’s Global Critical Minerals Outlook 2025 focuses on copper, lithium, nickel, cobalt, graphite and rare earth elements, noting that these minerals are central to clean-energy technologies. In 2024, lithium demand increased by nearly 30%, while nickel, cobalt, graphite and rare earth demand increased by 6–8%, mainly driven by electric vehicles, battery storage, renewables and grid networks. 

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The pressure on resources is expected to grow. UNEP’s Global Resources Outlook 2024 states that, without urgent action, global resource extraction could rise by 60% by 2060 compared with 2020 levels, increasing environmental damage and systemic risks. This means the sector’s sustainability agenda cannot be limited to cleaner extraction alone; it must also include circular economy, demand reduction, recycling, responsible sourcing and lifecycle-based resource efficiency.

 

Environmental Sustainability Issues

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The most material environmental impacts of mining and quarrying arise from land use change, ecosystem disruption, waste rock and tailings generation, water abstraction, acid mine drainage, dust, air pollutants, energy consumption, greenhouse gas emissions and post-closure liabilities. GRI’s GRI 14: Mining Sector 2024 was developed specifically because mining has broad economic, environmental and social impacts and because consistent, granular and comparable reporting is needed across the sector. 

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A core environmental issue is tailings management. Tailings facilities can create catastrophic risks if poorly designed, governed or monitored. The Global Industry Standard on Tailings Management, developed by UNEP, ICMM and PRI, aims to prevent catastrophic failures and improve tailings safety globally. It emphasizes affected-community engagement, human rights, environmental protection, climate-related tailings risks, restoration and structured risk classification for existing and planned facilities. 

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Water management is another central issue. Mining operations may compete with communities, agriculture and ecosystems for water, particularly in arid or water-stressed regions. Good practice requires site-level water balances, catchment-based water risk assessment, water recycling, progressive reduction of freshwater intensity, treatment of contaminated water, and transparent disclosure of withdrawals, discharges and water quality impacts.

Biodiversity and land rehabilitation are equally critical. Open-pit mining, quarrying and associated infrastructure can fragment habitats and alter landscapes. Responsible operators should apply the mitigation hierarchy: avoid, minimize, restore and offset residual impacts only where necessary. Mine closure plans should be prepared before production begins, updated throughout the mine life, financially provisioned, and aligned with post-mining land-use expectations of local communities.

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Climate and Energy Transition

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Mining is both exposed to and enabling the climate transition. On one side, the sector supplies the minerals needed for low-carbon technologies. The World Bank has estimated that production of minerals such as graphite, lithium and cobalt could increase by nearly 500% by 2050 to meet clean-energy technology demand, with more than 3 billion tonnes of minerals and metals needed for wind, solar, geothermal and energy storage deployment under a below-2°C future. 

On the other side, mining operations are energy-intensive and often rely on diesel equipment, fossil-fuel-based electricity, explosives, thermal processes and long-distance logistics. Decarbonization priorities include electrification of mining fleets, renewable electricity procurement, energy efficiency, low-carbon processing technologies, methane reduction in coal mining, optimized haulage, automation, and supplier engagement for Scope 3 emissions.

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Social Sustainability Issues

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The social sustainability agenda of mining includes occupational health and safety, decent work, community relations, Indigenous Peoples’ rights, land access, resettlement, local employment, gender equality, artisanal and small-scale mining interactions, security practices and human rights due diligence.

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Mining can generate employment, infrastructure, tax revenues and regional development, but it can also create conflict where communities face environmental degradation, insufficient consultation, weak benefit-sharing, land displacement or inadequate grievance mechanisms. The OECD states that mineral supply chains can be linked to serious human rights abuses, money laundering, bribery and financing of armed groups, and that due diligence is needed across the full minerals supply chain from mine to end user. 

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For credible social performance, companies should implement human rights impact assessments, free, prior and informed consent where Indigenous Peoples are affected, transparent grievance mechanisms, community development agreements, local procurement strategies, worker safety systems and independent monitoring of high-risk sites.

 

Governance, Ethics and Responsible Sourcing

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Governance is a decisive sustainability factor in mining because project approvals, royalties, licensing, land rights, environmental permits and community relations often involve high public interest and corruption risk. The EITI Standard 2023 is a global benchmark for transparency and accountability in oil, gas and mining, and includes requirements related to environmental and social impacts of extractive activities. 

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Responsible sourcing is increasingly important for downstream users in automotive, electronics, batteries, renewable energy and defence. The OECD Due Diligence Guidance provides government-backed recommendations for companies in mineral and metal supply chains to identify, address and mitigate risks related to human rights abuses, conflict financing and financial crimes. 

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The sector should therefore strengthen board-level ESG oversight, anti-corruption systems, beneficial ownership transparency, contract and payment disclosure, supply-chain traceability, whistleblowing systems, independent assurance, tax transparency and alignment with recognized standards such as GRI 14, ICMM Mining Principles, OECD Guidance, EITI and the Global Industry Standard on Tailings Management.

 

European Union Policy Context

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The EU’s sustainability agenda for mining is increasingly connected to strategic autonomy and critical raw materials. The Critical Raw Materials Act, Regulation (EU) 2024/1252, entered into force on 23 May 2024. It aims to secure a resilient and sustainable supply of critical raw materials and sets 2030 benchmarks for strategic raw materials: at least 10% of annual EU consumption from EU extraction, 40% from EU processing and 25% from recycling, while reducing dependence on any single third country to below 65% for each strategic raw material. 

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In March 2025, the European Commission selected 47 Strategic Projects to strengthen EU strategic raw material capacity; these included 25 projects with extraction activities, 24 processing projects and 10 recycling projects. This shows that European mining policy is moving toward a dual objective: increasing domestic and diversified supply while requiring higher environmental, social and governance standards.

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Key Sustainability Risks

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The main sustainability risks for the Mining and Quarrying sector are: high greenhouse gas and energy intensity; water stress and contamination; tailings dam failure; acid mine drainage; biodiversity loss; land degradation; weak closure planning; occupational accidents and fatalities; community opposition; Indigenous rights violations; forced or unfair resettlement; corruption and licensing risks; conflict-mineral exposure; tax transparency concerns; and insufficient supply-chain traceability.

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These risks are material not only for companies but also for lenders, insurers, governments, downstream buyers and local communities. Poor performance can lead to project delays, loss of permits, litigation, reputational damage, higher financing costs and social licence erosion.

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Key Sustainability Opportunities

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The sector also has major sustainability opportunities. These include supplying minerals needed for the clean-energy transition, developing low-carbon mining operations, increasing mineral recovery from waste and tailings, improving water recycling, using renewable electricity, deploying electric and autonomous equipment, applying digital monitoring for tailings and safety, expanding recycling and urban mining, improving local development outcomes, and building transparent mineral supply chains.

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Circular economy is particularly important. For Europe, the Critical Raw Materials Act explicitly links extraction with processing and recycling benchmarks, showing that sustainable mineral security depends not only on new mines but also on secondary raw materials, better recovery rates and lower material waste. 

 

Recommended Sustainability KPIs

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A sustainability assessment of Mining and Quarrying companies should include at least the following indicators: Scope 1, Scope 2 and relevant Scope 3 GHG emissions; energy consumption by source; renewable electricity share; water withdrawal, consumption, recycling and discharge quality; operations in water-stressed areas; land disturbed and rehabilitated; biodiversity-sensitive sites affected; tailings facilities by consequence classification; externally reviewed tailings facilities; waste rock and hazardous waste generated; acid mine drainage risk; lost-time injury frequency rate; fatality rate; occupational disease cases; workforce diversity; local employment and local procurement share; community grievances and resolution rate; human rights due diligence coverage; security incidents; anti-corruption training; payments to governments; closure provisions; and percentage of production covered by responsible sourcing or third-party assurance standards.

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Sector Outlook

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The Mining and Quarrying sector will remain indispensable for the global economy and the low-carbon transition, but its legitimacy will increasingly depend on whether it can prove that mineral production is responsible, transparent, low-impact and socially accepted. Demand for critical minerals is rising, especially for electrification and clean-energy technologies, but regulators, investors and downstream customers are also raising expectations on traceability, human rights, biodiversity, water, climate and tailings safety. 

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The strongest companies in the sector will be those that treat sustainability not as a reporting exercise but as a core operating model: integrating ESG into exploration, project design, permitting, production, procurement, closure and post-closure stewardship.