By: Dayron Monroy, Head of Standards and Certifications
In programmes supporting artisanal and small-scale mining (ASM), there is an ongoing debate about the minimum legal requirements that should be demanded from beneficiary organizations. Two opposing camps usually dominate the discussion. On one side are those who advocate for equitable impact and argue that programmes should target the most vulnerable organizations that need support to comply with the law and escape development traps. On the other side are those who, with a pragmatic tone, argue that only organizations already in legal compliance should be engaged, in order to avoid public controversies and reputational risk. Both camps have strong arguments and intellectual integrity. Should miners who have not yet achieved legal compliance be excluded to reduce reputational risk, or should they be included to maximize the impact of interventions? This ethical dilemma is addressed through the lens of ARM and OECD Standards, inspired by a recent case study published in the journal World Development.
Photo by ARM
Evidence from Colombia’s Pacific Coast
Together with colleagues from Universidad de los Andes and Duke University, we recently published a paper analyzing the barriers two mining communities on Colombia’s Pacific coast face in accessing certification. The results show that while miners are willing to participate in certification programmes that give access to ethical markets with conditional economic incentives, the formation of work associations—a requirement for obtaining and managing a mining title—is perceived as costly and complex.
Out of 460 small-scale miners surveyed, two-thirds said they were willing to contribute their own funds to cover formalization costs. The same proportion said they would volunteer a few hours a week to support certification, whether through environmental restoration in mined areas or administrative tasks required for documentation and reporting. However, only 2% of those surveyed belonged to a legally established mining association, significantly limiting the ability to channel this goodwill into actual formalization and certification. Without association, small-scale miners cannot move toward formalization, and without formalization, certification remains out of reach.
Breaking this vicious circle requires informal organizations to find a pathway to join programmes and engage in joint efforts to strengthen association, obtain mining titles, and progressively formalize. However, both public and private actors are often reluctant to engage with informal groups due to the high reputational risks involved. The persistent confusion between informal and illegal mining increases this perception and limits the actions that programmes like FAIRMINED, planetGOLD, and others can offer to the critical mass of ASM, which is mostly informal.
While our article does not allow for broad generalizations, other studies have documented fragile governance in mining regions across the Global South and the limitations of addressing ASM solely through a legalistic lens. The Intergovernmental Forum on Mining estimates that between 70% and 80% of ASM worldwide operates informally. This reality imposes a hard truth on programmes: legally compliant mining is the exception, and any serious attempt to transform the sector at scale must include a strategy to engage with informal miners.
Understanding Informality to Identify Legitimate ASM
Not all informal ASM is suitable for inclusion in programmes. This segment also includes illegal operations that must be identified and excluded to mitigate reputational and security risks. To distinguish informal operations that act in good faith and do not finance conflict from illegal ones that present serious risks, the Organisation for Economic Co-operation and Development (OECD) introduced the concept of “legitimate ASM” in its Due Diligence Guidance for Minerals from Conflict-Affected and High-Risk Areas (OECD Minerals Guidance).
If a jurisdiction has a legal framework for ASM that is effectively enforced, an operation is considered legitimate only if it complies with that framework and is free from the serious risks outlined in Annex II of the OECD Minerals Guidance. If the legal framework is non-existent or not enforced, legitimacy is defined by good-faith efforts to comply with the law and the absence of the same Annex II risks.
The OECD Minerals Guidance gives us a concrete framework to address informality. It is not the same for a mining organization to be informal because it deliberately avoids regulation and evades taxes, as it is to be informal because it faces requirements designed for large-scale mining, never received responses from authorities regarding formalization processes, or lacks access to capital markets to invest in the infrastructure required by law.
I have encountered many cases like these across countries where I’ve worked in recent years, in which ASM organizations face structural barriers that prevent formalization. In such contexts, the OECD’s concept of legitimate ASM has proven useful in defining, objectively, which informal mining groups I can ethically engage with: those that have a genuine intent to comply with the law and are not linked to conflict financing or serious human rights or environmental violations.
Engaging Under OECD Conditions Through the CRAFT Code
To operationalize this legitimacy assessment, a clear and publicly available framework already exists: the CRAFT Code. The CRAFT Code adopts the OECD concept of legitimacy and translates it into specific criteria for four possible regulatory contexts found in ASM-producing countries.
Código Craft volumen 2, módulo 2
The most common regulatory context is Case 2: countries like Colombia or Ecuador, where differentiated rules exist for ASM but are weakly or inconsistently enforced. In these cases, the challenge lies in identifying organizations that would comply with the legal framework if the government were effectively implementing it. Programmes can use ARM & OECD Standards to ethically justify working with legitimate informal groups and to collaborate with governments in identifying regulatory gaps and overcoming bottlenecks in the formalization process.
In Case 3 contexts—countries like Lesotho or Eritrea—the law only allows the formalization of large-scale mining operations. Here, the challenge is to outline what an appropriate ASM framework should look like. ARM & OECD Standards offer a progressive reference pathway: starting with legitimacy, followed by internal risk management aligned with Annex II, and culminating in compliance with voluntary sustainability standards such as FAIRMINED.
A similar situation arises in Case 4 contexts—countries like Guinea or Kenya—where ASM can sell production in local markets de facto but has no clear legal path to obtain a license or title. The challenge here is similar to Case 3: to use ARM & OECD Standards as a reference framework to guide organizations from legitimacy, through risk management, and eventually toward sustainability.
Finally, in Case 1 contexts, where an effective ASM-specific legal framework exists and is enforced, there is no need to apply the concept of legitimacy. In these settings, only organizations already in legal compliance can be ethically engaged.
Conclusion
The transformation that ASM requires will not come from working only with those who are already in legal compliance. Ignoring 75% of ASM that remains informal perpetuates risk, poverty, and criminal influence. Including them, however, demands the application of a concept already recognized by the OECD: legitimate ASM.
ARM’s standards system, aligned with the OECD Minerals Guidance, provides that legitimacy filter and a roadmap to advance risk management in human rights and environmental areas and, ultimately, toward certified sustainability.
Applying this approach enables ASM organizations to access finance and ethical markets, helps governments gain traceability and improve tax collection, and allows investors to reduce their exposure to reputational risks.
To drive transformation at scale, the question should no longer be whether to engage with informal ASM, but how to do so ethically—while excluding illegal actors. State participation is essential, both to integrate ARM Standards into national legal frameworks and to provide support in high-risk regions where the line between informality and illegality is difficult to draw.