Q&A - Director of Global Mining at G4S, Andrew Hames, explains mining security concerns

Materials World magazine
24 Sep 2013

Melanie Rutherford speaks to Andrew Hames, Director of Global Mining at
G4S, about the issues facing security in the mining sector.

What is your background in the mining industry?
I joined G4S in 2011. Prior to that, I worked as the Head of Energy, Mining and Infrastructure for medical and security assistance organisation, International SOS Pte. While I was there, I had responsibility for establishing and growing new, high-risk markets. Then, in March 2011, I took up the role of Global Head of Mining for G4S’s secure transportation business.

In January 2012, I became G4S Group Director of Global Mining. I am responsible for the formulation and implementation of the company’s mining vision and strategy, and I work to develop close working partnerships with leading mining companies within G4S’s regions and countries of operation, of which there are 125. I have set up regional mining teams in Canada, the USA, South America, Asia, Africa and the UK to bring focus and specialisation to the market. We currently have around 18,000 employees directly supporting our customers in the industry.

Which countries do you currently serve and are there any region-specific risks associated with these?
We currently serve more than 350 mining customers at more than 370 sites in 59 countries across six continents. As it stands today, about half of our mining revenues come from Canada, the USA and Latin America, and the rest is split between Europe, Africa and Asia.

Challenges in developing markets vary greatly from one site to another and can often be unique regardless of country, region or continent. We have a core list of more than 50 operational risks that we address on any given site in any location, but beyond this, solutions are tailored to meet the individual client’s needs and our integrated security solutions can be fully tailored to their specific operating environment.

For example, copper mines in the Atacama Desert, in Chile, are troubled by dwindling water and energy supplies as wells as conflicts with the local industries over these scarce resources, whereas mines in South Africa are hampered by crime, theft and a turbulent workforce. We have to cater to these different types of challenges.

We have developed a system to provide a targeted risk analysis for companies that are expanding their operations and moving into increasingly hostile territories around the globe. The essence of the system is an online portal that provides users with geopolitical intelligence on past, current and future global threats. The outputs from GIS are devised according to each subscriber’s operating markets, thereby providing each company with a unique risk-analysis tool that assesses the threats specific to that business and, therefore, caters to regional challenges and risks. This helps companies to make better-informed critical business decisions, regardless of the part of the world in which they operate.

What are the main challenges currently facing the sector?
The majority of challenges are dependent on the region or environment of the mining site in question, therefore the risks vary significantly across the globe. For instance, Australia and Canada are facing high levels of competition and decreasing quality of material, whereas the US market is suffering from over-regulation and limited opportunities.

It’s no surprise that the key growth regions are all developing markets, and the risks facing the sector in these environments have become more extreme and complex due to the fast-changing investment and operational environments. However, all mining companies are ultimately concerned with their business outlook and, regardless of their distinct locational challenges, their overarching drive is to secure shareholder returns through solid business performance.

As such, the main challenges to the sector are overcoming obstacles such as volatility in the market and the associated price and currency fluctuations, access to capital, productivity improvement, resource nationalism, lack of skilled labour and adequate cost inflation, reputational risk, maintaining a social and political license to operate, fraud and corruption.

We have recently seen a generation of chief executives replaced – the new industry leadership will be focused on cutting costs, project delivery and core business strengths. Shareholders are demanding value and deserve returns.

Broadly speaking, there has also been a rise in organised crime and terrorism, which has led companies to seek more stringent security provisions. Therefore we see the management and mitigation of risk and threats becoming evermore important to the mining sector. And increasingly, security is becoming an integral part of securing business performance within the mining industry. Progressive companies are recognising such risks and working with their security partners to tackle this, through partnership and collaboration.

How do you go about addressing these issues?
There is a range of important factors that must be considered to ensure the successful provision of security operations within the industry. Good communication is crucial in effective security provision, and only through this can long-term working partnerships be built with customers and our initiatives integrated into their sustainability efforts. We also place the highest importance in employee training and encouraging continuous improvement and innovation, using the optimal mix of highly skilled personnel and the best technology.

Our approach is to initiate solutions through a deeper involvement at the strategic decision-making stage of a project when exploration and assessment is underway, through to the evaluation and analysis of a particular project. We begin with an assessment of the unique challenges each customer faces before creating a tailored and integrated security approach.

Assessment has to be done in close consultation with the customer, because we have to align ourselves with their business strategies and goals. To develop a security framework that is agile and flexible enough to anticipate, detect, manage and mitigate any potential threat and risk, we need to assess threats and vulnerabilities, develop plans and procedures, and ensure there is access to accurate and timely information.

We use end-to-end methodology that links risk management and crisis management. We carry out a threat assessment, where we quantify the threats based on their capability and intent to cause harm or loss. Then we conduct a risk assessment and prioritise risk based on impact versus probability.

Once the nature and extent of the risk is established, the team makes an informed decision on how to manage each risk and then puts together the security framework.

Do you see the challenges changing over the next five years?
Our customers are constantly faced with huge external pressures that impact how they operate and how they perform. Over the next five years, I’m sure the challenges we face will continue to evolve, and our operations will adapt accordingly.

If the trend over the past few years is anything to go by, regulation is becoming ever stricter and competition for resources is growing. Demand and supply is coming from emerging markets. Companies are going deeper, projects are more technical and they are moving away from existing infrastructure. Mitigating the new associated risks and threat environment is crucial to the long-term success of any project.

This means we have to stay ahead of the game and continue to assist customers with effective security provision in the longer term, to help ensure the sustainability of their mining projects. This is why greater involvement at the strategic decision making stage is crucial.

Are there any risks you commonly encounter?
From an operational perspective, challenges vary from one site to another. We have a core list of more than 50 operational risks that we need to address on any site, but the most prominent of these would be theft (including fuel and equipment, and attempted theft of high-value material), common assault, drug and alcohol abuse, and unlicensed mining activity.

In fact, illegal mining is indicative of the complex and demanding security challenges our customers face. The result is often high levels of competition for access to resources, and violence fuelled by well financed and often well-connected networks with national and international reach. Collusion between staff and unlicensed miners is common, and often characterises illegal activities on a site.

Tell me about the G4S Human Rights Policy and how this will affect the mining sector.
With such a vast and diverse workforce comprising more than 620,000 employees operating in some of the most challenging environments in the world, it is vital that we have a unified, ethical and sustainable human rights policy.

The Human Rights Policy is aimed at protecting employee rights, supporting the communities in which we operate, and ensuring that operational practices recognise and mitigate human rights risks. Our policy positions our human rights practices alongside the United Nations Guiding Principles on Business and Human Rights (2011), and will ensure that our policy is uniformly applied throughout our company across the globe.

This policy will enable us to ensure that we are not only looking to safeguard the rights of our staff and customers, as well as continuing to align our approach with existing standards, such as the Voluntary Principles on Security and Human Rights, but that we are also influencing and encouraging positive change in the environments we operate in.

The creation of our human rights policy was a three-stage process that involved identifying the key human rights relevant to the services that we provide, working out how to integrate these with recognised international human rights standards and identifying areas for improvement, before implementing and embedding the policy. This has ensured that our policy is truly tailored to the business itself, our customers and the nature of our work, and we are now also using this process in the implementation of other company measures, such as awareness and training programmes.

The policy is vital for the mining sector due to the challenging environments that many of our workers operate in, and the diversity of sites and associated challenges across the globe. It will ensure that all our staff, whether they are based in Papua New Guinea, Colombia, Canada or South Africa, are treated with equal importance and have the same duty of care afforded to them.

Why has the mining division of G4S grown so sharply in 2012, which was a year of decline for most other mining suppliers?
Our growth follows a re-evaluation of our business approach to the mining security sector, which we undertook at the start of 2012, and the changes we made to our business as a result.

This included the development of specialised and customer focused mining teams in Canada, USA, Latin America, Africa and the UK, and subsequently, a 50% growth in our annualised mining division revenue in 2012. We forecast that this growth will continue and our aim is to focus on our customer needs, build on our specialisation in key regions and develop further a culture of continued improvement.

Which countries have seen the biggest growth and do you foresee this changing?
Mining companies are constantly expanding into new markets and looking for opportunities in new regions. Currently, the Latin America, Asia Pacific and African regions are experiencing the most growth. It is no real surprise that the key growth regions are all developing markets and this expansion trend is likely to continue over the foreseeable future, as this is where the mineral wealth lies.

However, the risks facing the sector in these environments have become more extreme and complex due to the fast-changing operational environment. As such, security will play an ever more important part in mining operations.

For more information, contact Andrew Hames andrew.hames@g4s.com