From Risk to Resilience: Why Mining’s Greatest Threats Are Social, Not Geological

MINING INDABA 2026 INSIGHT SERIES | 18 February 2026

For much of its history, mining has defined risk in technical and commercial categories: ore grade, metallurgical complexity, capital intensity, logistical feasibility, and price volatility. These risks remain material. However, today, they are rarely what determines whether projects proceed on time, or at all.

The most significant threats to a mining project are no longer found only in the ore body and location, but now equally in the social and political systems surrounding it.

While innovation and engineering skills are increasingly a match for managing technical risks at mines; across jurisdictions, factors such as community opposition, permitting delays, legal challenges and reputational exposure now account for a growing share of project disruption and value erosion, requiring a different set of management attributes. In effect, risk exposure has shifted from geology and engineering to governance and trust.

Did you know? Industry and lender assessments consistently identify community conflict and permitting delays as leading causes of mining project disruption, often rivaling technical risk factors.

The Rise of Social License Risk

This shift is increasingly recognised by investors, financiers and regulators. Development finance institutions and multilateral lenders have shown that unmanaged social risk translates directly into schedule slippage, cost overruns and, in some cases, stranded assets. Investor surveys similarly rank regulatory uncertainty among the most significant deterrents to capital allocation.

What distinguishes social risk from technical risk is its nature. Social risk is relational. It accumulates when trust erodes, escalates when engagement is superficial, and becomes most costly when addressed too late. Unlike geological risk, it cannot be engineered away.

This is where TDi Sustainability’s work often begins: helping companies and investors identify emerging social risk early, by designing engagement systems that prevent escalation, rather than reacting after disruption occurs.

Why Does Binary Thinking Fail?

Despite the evidence, social risk is still often framed in binary terms: approved or opposed, legal or illegal, compliant or non-compliant. This framing obscures reality and weakens risk management.

Communities are rarely homogeneous. Consent is not static. Artisanal and small-scale mining (ASM) is rarely entirely illicit, or entirely legitimate. Treating these dynamics as fixed conditions leads to brittle strategies and broken systems.

Projects that treat ASM purely as illegal activity often face recurring incursions and enforcement costs. By contrast, operations that define coexistence pathways, through licensing, safety standards and market access, tend to reduce conflict while improving oversight. TDi supports operators and governments in designing these coexistence models, strengthening legitimacy and supply chain integrity.

Did you Know? Excluding informal actors from mineral value chains does not remove them, instead it often increases safety, environmental and conflict risks.

FPIC, Grievance and Trust as Risk Infrastructure

If social risk is relational, then trust functions as critical infrastructure. Free, Prior and Informed Consent (FPIC), effective grievance mechanisms and transparent benefit-sharing are often viewed as ethical add-ons. In reality, they are operational systems that stabilise projects over time. At TDi, we work with our sister organisation, The Impact Facility for Sustainable Mining Communities, to enable operational efficiencies, cross-industry learning, and the flow of resources and capital to mining communities around the globe.

When designed as ongoing processes rather than one-off approvals, FPIC and grievance mechanisms function as risk management tools, not veto mechanisms. They surface concerns early and reduce escalation into litigation or protest. TDi’s FPIC-related work helps companies translate principles into systems that operate day-to-day and stand up to investor and community scrutiny.

“When social systems are treated with the same rigour as technical ones, projects don’t just survive uncertainty, they outperform it.”
~Assheton Stewart Carter

From Risk Avoidance to Resilience

The true costs of social disengagement are no longer abstract concepts. Delays measured in months translate into deferred revenue, higher financing costs and diminished investor confidence. For large-scale operations, even short disruptions can equate to substantial value being lost.

By contrast, early and continuous engagement carries a comparatively modest cost. Evidence across extractive sectors shows that proactive investment in community participation, ASM coexistence planning and rights-based processes improves schedule certainty and reduces long-term exposure.

For boards, investors and permitting authorities, the implication is clear. Social risk cannot be mitigated through distance or exclusion. It must be managed through participation, integration and systems that recognise communities as stakeholders in these outcomes.

Resilience in mining is now built above ground, an execution challenge that sits at the core of TDi Sustainability’s work across the mining value chain.