CASE STUDIES
Due diligence assessment of LBMA gold refinery’s supplier
An LBMA gold refinery retained Kumi to provide external assurance on its precious metals suppliers. As part of this assignment, Kumi was commissioned to undertake due diligence assessments on a Peruvian gold mine against the LBMA Responsible Gold Guidance.
The project
Kumi developed an assessment protocol in line with the requirements in the LBMA’s Guidance, to guide a two-phased assessment approach.
- We reviewed the gold producer’s policies and management systems, including environmental and social impact assessment reports, ESG performance data and reports, review of media and NGO reports, and relevant third-party reports to identify potential gaps and priority areas to be reviewed during the site visit at the mining operation.
- Our team visited the mine site to interview site management and key personnel overseeing management processes and controls for social and environmental risks. We also interviewed workers and walked through the management system to validate the findings from our desk-based assessment. In addition to the mining activities, we reviewed processing operations, transportation methods, and routes.
Our recommendations
Our assessment showed that the mine met most of the LBMA Responsible Gold Guidance requirements. In some areas, notably around working hours for security personnel and community relations, we made specific recommendations for our client to continuously monitor site-level risks.
The outcome
Our engagement has enabled our client, the LBMA gold refinery, to understand the risks within its supply chain in much more detail. This has enabled it to meet the LBMA’s expectations for responsible sourcing and manage reputational risks. Kumi is now working with our client to evaluate risks in its recycled material supply chain.