With the global transition to an energy system based on renewables expected to lead to a sharp increase in demand for critical minerals, the mining sector may provide attractive investment opportunities. Quite simply, without mining companies and the metals they produce, there can be no clean energy transition.

Mining companies raise concerns for investors due to the potentially negative environmental and social impact of their operations. While these issues cannot be ignored, they also recognise the progress that some mining companies are making in terms of the sustainability of their operations, as well as the vital contribution they are making to the energy transition. J.P. Morgan Asset Management believe proactive engagement can lead to more favourable outcomes from a sustainability perspective than blanket exclusions.

J.P. Morgan Asset Management have developed criteria for including mining companies in certain sustainable funds. This piece outlines the framework defined and utilised by portfolio managers for evaluating companies mining for critical energy transition minerals in the context of these specific funds. They only include companies that meet strict environmental and social standards, are involved in the extraction of energy transition minerals, and are willing to engage with them regularly on material and relevant sustainability issues.

Learn more here