The controversy surrounding Rio Tinto’s Oyu Tolgoi (OT) copper and gold mine in Mongolia has once again drawn global attention to the disconnect between ethical investment claims and corporate accountability. While the mining giant recently paid US$139 million (AU$211 million) to settle a lawsuit with U.S. investors over cost overruns, local Mongolian herders continue to suffer from the project’s long-standing environmental impacts.
For over a decade, herding families in southern Mongolia have raised alarms over water contamination and soil degradation linked to the mine’s tailings seepage, which Rio Tinto has acknowledged since 2013. According to environmental audits, the leak migrated off-site into a nearby riverbed, threatening groundwater resources critical to local communities and livestock.
Despite the severity of the issue, Rio Tinto only met with affected herders a year after admitting the leak, and no effective measures have been taken to halt the seepage. Experts say the company’s response has focused on monitoring and containment rather than preventive measures, such as improving tailings storage design or reducing water content in waste materials.
Auditors and independent assessors have flagged multiple safety and environmental failures, including inadequate seepage collection systems, missing cutoff trenches, and a lack of reliable indicators to monitor contamination. Meanwhile, Rio Tinto has not disclosed the full list of chemicals present in the seepage, nor provided medical screening or compensation for affected herders.
Critics argue that the cost of these design flaws has been externalised onto local communities and ecosystems, while investors have received swift settlements. “Rio Tinto’s willingness to pay investors but ignore local harm highlights a troubling double standard,” wrote Caitlin Daniel and Julio Castor Achmadi of Accountability Counsel, who have worked with affected communities.
The Oyu Tolgoi mine, expected to operate for another 30 years, is one of the largest copper projects in the world and a key asset for Rio Tinto’s global portfolio. However, the company’s handling of the project has raised reputational concerns for investors and financiers, including the International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD), which helped arrange new funding for OT last year despite ongoing environmental disputes.
The authors argue that ethical investors must demand greater transparency and accountability from Rio Tinto, warning that the company’s pattern of delayed responses and unfulfilled promises could pose both financial and moral risks.
“If Rio Tinto won’t uphold its environmental and social standards,” they conclude, “investors must ask whether this is a company worth backing — or a liability in the making.”
