Australia

Details

  • Industry: Energy & Natural Resources, Mining
  • Type: Survey report
  • Date: 28/02/2014

Mining risk and assurance: A survival strategy 

Mining companies are currently faced with falling margins, commodity demand and prices, major project failures and a continued escalation of input costs. Risk management is also under the microscope. Based on interviews with several KPMG International partners, this paper identifies eight key drivers of value from growth to sustainability and reputation to taxation, examining the risks inherent in each of these areas.
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To survive and prosper, mining companies must overcome a wide and diverse range of risks and adopt a holistic, integrated risk and assurance strategy – crucial to their becoming masters of risk, rather than victims.

 

Key insights

  • By aligning strategy with regulatory requirements, leadership can understand the true costs of major decisions and minimise financial or reputational damage.
  • Mining companies should quantify the future impact of sustainability 'megaforces' such as climate change and energy scarcity.
  • Processes and controls alone are not sufficient; risk management is part of everyone's daily job.
  • To maintain high productivity in difficult and dangerous environments, capital equipment and geological assets should be carefully managed.
  • Compliance is essential to good governance and risk management, with the board holding ultimate responsibility.
  • An effective tax compliance strategy strengthens relationships with revenue authorities and gives greater certainty over tax obligations.
 

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Energy & Natural Resources

KPMG's Energy & Natural Resources team provides services to all key sectors: mining, oil and gas, power and utilities, renewables, forestry and water.

Mining

KPMG's Mining professionals assist organisations through all stages of the mining project lifecycle, from exploration to production.