Glencore paid $5.8B to governments in 2020

Swiss-based multinational miner Glencore (LSE: GLEN) has disclosed US$5.7 billion in taxes, royalties and other government payments in 2020.

The diversified mining house says the Covid-19 pandemic caused major production outages across the portfolio last year amid softer commodity prices: the result, lower payments to host nations compared with the 2019 total of US$7.7 billion.

The group’s effective income tax rate, pre-significant items, was 29.7% in 2020, consistent with the 30.5% reported in 2019.

Glencore says its contributions go beyond the taxes and royalties it pays, with its activities contributing significant, long-term socio-economic value to our operating countries. It enables governments to realize value from their natural assets and fund public services and infrastructure to improve their nation’s way of life.

“Our global footprint can make significant and sustainable economic benefits to our host governments, employees, suppliers and communities through the provision of employment and training, tax and royalty payments, local procurement, social development and environmental stewardship,” says CFO Steve Kalmin in a media release.

The 145,000 people working for the company on more than 150 mining, metallurgical and production sites received US$4.6 billion in wages and benefits in 2020. It also spent US$95 million on initiatives benefiting communities living around its operations, including US$15 million on Covid-related activities.

Glencore makes the annual disclosures as a signatory of the Extractives Industry Transparency Initiative, which aims to increase transparency regarding multinational miners’ interactions with host governments and local suppliers.

Glencore has committed to publishing an annual modern slavery statement and is also committed to considering social, ethical and environmental considerations when managing relationships with suppliers. The measures help address human rights risks in Glencore’s supply chains.

Glencore is also a signatory to the United Nations’ Global Compact, a set of principles covering human rights, labor, environment and anti-corruption, and operates by the Core Conventions of the International Labor Organisation.