Who said ESG and resources don't mix? This mining services stock just entered the ESG trade

ESG and the resources sector haven’t got the best relationship but mining tech stock RPM Global (ASX:RUL) has bucked the trend.

While some ESG metrics might arguably be good for some resources companies, such as governance, the two sectors have an uneasy relationship over environmental concerns.

One ESG fund manager, eInvest’s Emilie O’Neill, arguably summed up the broader sector view the best while speaking with Stockhead last week.

“For us they’d have to do something that was super positive to consider it – it’s not a sector we actively seek out,” she said.

But RPM has bucked the trend in announced it was buying Nitro Solutions, a Brisbane-based company which provides ESG services to the mining sector.

Nitro’s areas of expertise include environmental approvals, impact assessment, regulatory advice, environmental audits, compliance reporting and environmental economics, policy and legislation advice.

‘Just the start of RPM’s ESG journey’

While RPM employs some ESG professionals, the company did not have an ESG-dedicated division.

RPM CEO Richard Matthews said the acquisition was an attempt to gain a foothold in the ESG mining services industry, and just the beginning.

“Mgaire [Tranter – the CEO of Nitro] and her team have an excellent reputation within the mining ESG market which gives us great confidence that we can build a world-class mining-focused ESG business leveraging an ESG team that knows and understands mining from the ground up,” he said.

“This is just the start of RPM’s ESG journey as we look to grow RPM’s ESG mining services capabilities both organically and inorganically.

“We also intend to harness the deep ESG domain knowledge of the Nitro team to assist RPM’s technology division to identify software products we can either acquire or alternatively build to service this accelerating market segment.”

RPM will pay approximately of $2.1 million, $1.68 million of which is in cash and the remainder in shares and a working capital adjustment.