Hey there, welcome to The Forward! I’m Bronwyn, I spent many years leading social performance and community relations in mining, including as Head of Social Performance at Rio Tinto. Now I run Cantilever, where I advise mining and resources companies on sustainability strategy and complex stakeholder engagement.
If you want to talk about your strategy, get in touch with me here.
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Last week we looked at Teck and found the largest payment to the Iñupiat at Red Dog sits in Teck's financial filings rather than its sustainability report. This week, a data centre company with a problem every mining company will recognise.
On 21 October, NEXTDC's shares fell 40 per cent in a day. Residents in Melbourne's inner west had blocked crews putting up 15-metre power poles to bring more electricity to its M3 data centre. The network company, Jemena, suspended the work until at least February 2027, and NEXTDC removed around $140 million of contracted revenue from its forecast.
Data centres need land, water and a lot of power, close to where people live. Mines often do too, and the challenges with neighbours are similar, such as noise, water, power and how the community benefits.
NEXTDC published its FY26 Annual Report on 27 August.
This week's question: Does NEXTDC's FY26 Annual Report highlight community acceptance as a risk to expanding the project?
- Bronwyn
NEXTDC (ASX:NXT)
Source: NEXTDC FY26 Annual Report (167pp) · Published 27 August 2026 · Reporting period 1 July 2025 to 30 June 2026 · Principal risks, pages 21-23 · Sustainability Report, pages 66-88, climate-related disclosures under AASB S2 · Specified climate disclosures reviewed by PwC, limited assurance.
NEXTDC is one of Australia's largest data centre operators, with 18 operating data centres at 30 June 2026. Two are in the Pilbara, PH1 in Port Hedland and NE1 in Newman. Both serve mining and telecommunications customers in the region.
The local council approved M3 in West Footscray in 2021 as a 150 megawatt campus (see definition in glossary). It opened in 2022, about 15 metres from homes, and has long faced complaints about noise and diesel generators. It is now planned at 225 megawatts. In March NEXTDC applied to the state Planning Minister to double the size of the site.
Passage 1: The community risk
The last of the report's 13 principal risks, on page 23, covers reputation, community and social licence.
“Adverse media coverage, community concern, or failure to maintain trust and engagement with stakeholders may impact reputation, regulatory outcomes, development approvals and the ability to execute strategic objectives.”
The report says it manages this risk through “structured community consultation for new developments”.
Community concern is named as a risk to approvals and to the company's strategy. Regis's risk list, in Issue 27, didn't mention heritage at all.
However, M3 isn't new. Much of this year's opposition is about growing a site people already live next to.
In mining, this is things like a pit expansion, or extension of the life of mine.
In my experience, expansion is an ongoing information sharing exercise, rather than a ‘start again’ conversation. A new project gets a lot of rigour at the start. Expansions are often treated as already approved and accepted, and that is where the risk sits, although bigger expansions do get that rigour.
Plain English: NEXTDC names community concern as a risk and commits to consultation for new developments.
Passage 2: Power supply as a supplier risk
On page 22, the report covers the risk associated with the companies in its supply chain, like Jemena in this instance.
“Failure of critical suppliers, utilities, contractors, strategic partners or infrastructure providers to deliver required services, equipment, resources or capacity may adversely impact operations, project delivery and strategic growth objectives.”
This is the risk that eventuated at M3. Jemena is the utility provider.
NEXTDC told the market that Jemena suspended the work over safety concerns, residents blocking access to work sites, and the council withholding consent as road authority until more consultation takes place.
The report treats Jemena as a supplier, so consultation along the power line route sits with Jemena. Mining does the same with contractors, who are often required to meet social performance targets such as local employment and local procurement. The targets can be handed over, but the risk always stays with the project.
Plain English: The report treats a delay in power supply as a supplier risk. At M3, the delay came from the community along the power line route.
The Frame
So, does NEXTDC's FY26 Annual Report highlight community acceptance as a risk to expanding the project?
Not directly. It names community concern as a risk, but ties consultation to new developments and treats power supply as a supplier question.
In this instance, the route matters as much as the site. A haul road, rail line, pipeline or power line often crosses more landholders and native title interests than the pit, and the work is often done by a contractor or a utility.
NEXTDC's report shows a wider shift I’m seeing in many Annual/Sustainability reports. Community risk now sits in the annual report's principal risks, alongside capital and safety.
Two practical takeaways for anyone who signs off a project's risk register:
Give an expansion the same rigour as a new project. Companies often treat an expansion as already approved and accepted by the community. Start with the people already living close to the project.
Map the people along every route the project depends on. If a contractor or utility does the work, their consultation is still your risk.
Glossary
Principal risks.
The risks a company's board considers most likely to affect its strategy and results. NEXTDC lists 13.
Megawatt.
A measure of power. One megawatt running all day uses about as much electricity as 2,000 Melbourne homes. At full capacity, M3's planned 225 megawatts would use as much as about 450,000 homes.
Social licence.
The ongoing acceptance of a project by the people it affects. Governments grant approvals. Communities grant, or withdraw, social licence. At Cantielver, we use the term ‘Active Social Licence’ making it an ongoing exercise.
What did you think of this newsletter?
This week at CFS - Engaging communities when projects grow
Community acceptance is earned before construction starts, and maintained as a project changes, with a new stage, a longer mine life or a new power line. Cantilever helps mining and resources companies map who is affected across the whole footprint of a project, before the work starts. If that is a conversation worth having, get in touch by emailing Bronwyn directly at [email protected].