Christine Charles University of Queensland

Transcription

1 Christine Charles University of Queensland

2 The context A global industry with a patchy past and significant change and growth in capacity and understanding over the past 15 years, driven by increasing scrutiny and expectations for improved performance, balancing commercial objectives and: environmental and social outcomes, benefit sharing, cultural security and a positive sustainable legacy.

3 The business case Gain and maintain a social licence Reduce negative operational impacts and social risks Avoid costs of escalated conflict Uphold policy commitments Access to finance (e.g. IFC requirements) Meet reporting requirements (e.g. GRI) Manage reputational impact for future activities

4 Mining business imperatives/risks 1. Access to resource (land) geographically locked 2. Timeliness of project approvals 3. Continuity of operations 4. Ability to close Grade and Costs Environmental constraints Community expectations Political environment Skills availability Safety

5 The Business Imperative On the back of failures it becomes easier to see that environmental, community and social sustainability make business sense and are crucial to business survival.

6 The future of the minerals industry is inseparable from the global pursuit of sustainable development. Successful development requires effective long term relationships and shared benefits between communities and companies.

7 Central to establishing and maintaining a social license to operate is effective community partnerships, engagement and consultation, and the management, and appropriate remedy of individual and community complaints and grievances.

8 Discussion, knowledge and capacity building are integral to enabling a more professionalised approach to community relations and conflict management, and improving industry performance in this area.

9 Principles Grievance mechanisms should align with internationally agreed principles, including: Legitimate Accessible Predictable Equitable Rights compatible Transparent (Ruggie 2008)

10 Supplementary principles Emerging guidance suggests that operational level mechanisms should also be: Based on engagement and dialogue Culturally appropriate Proportional Empowering Foster continuous improvement (Kemp and Gotzmann, forthcoming)

11 Grievance mechanisms are just one part of a suite of processes that aim to prevent, defuse and resolve communitycompany tension and conflict. They are an extension of the community engagement and development approaches of most companies

12 Factors in conflict Consultation and agreement making process. Expectations, benefit sharing. Intra-community relationships. Lack of effective government. Legacy issues. Use of land, water, community resources, displacement Sharing revenues locally, regionally, nationally. Use of security forces International Alert

13 The problem we face is that there is a very big gap between companies desire to operate differently and their capacity to do so.

14 Life of mine/project Access to land / negotiation Exploration Negotiation secure land Project development Operation. Closure and rehabilitation. Long-term monitoring

15 Not One Company As a project moves through its negotiation, approval, development, operational and closure phases, entirely different individuals and groups within the company are involved. At points of handover, knowledge and experience in agreements, community engagement and commitments may or may not be addressed. Rare for CR and CD professionals within companies to be seen as doing core business or part of core decision making groups

16 Corporate Culture Resources sector is global Senior Executives largely do not represent a national perspective Market driven and risk focussed Sites tend to be command and control Oversee many similar operations across the world Internally projects compete globally for funding Implement through complex and long supply chains Often disconnected from the Mid tiers and SMEs who are delivering the activity on which commitments have been made

17 Supply Chains, Multiple Players Players who engage with the community are often agents for the main company but separate. In mining everything from exploration, project development, aspects of operation and most supply, are provided by companies other than the parent/owner company. In oil and gas there is somewhat more vertical integration, but managing the supply chain is still an issue. Mid Tier and SME players are largely not engaged in global debate but are very important regionally and locally

18 Embedding Commitment, Materialising Opportunity Agreements, structures and processes developed in arriving at benefit sharing agreements, economic development plans and community/social development must stand the test of changing personnel and increasing distance within the company of the intent of commitments

19 Lost Opportunity The time frames involved in project development and approval often mean that by the time the community has developed the capability to take up economic opportunities, the chance has passed by. A focus on the big players will miss doors into medium and small players in the development Aiming to be able to operate in a commercially competitive way is a critical element of economic sustainability.

20 A few experiences Indonesia Peru India Australia To the degree that conflict is a reflection of competing needs and expectations, it is a natural consequence of interactions between diverse community stakeholders and the mining company. Newmont CRR

21 Indonesia The opening of the Batu Hjau mine on Sumbawa led to significant population growth in the local area. Local government institutions with jurisdiction over the mine are very new and are still in the process of building internal capacity. The mine operates in a national context characterized by considerable legal and regulatory uncertainty. There is a significant demand for employment and the development has been large-scale and rapid.

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23 Stakeholders are concerned about the sustainability of the mine s community development programs. The Community Development team is underresourced. Community stakeholders are frustrated at a perceived lack of information regarding both the allocation of community development resources and the environmental impacts of the mine s operations. The Mina Hasa mine experience on Sulawesi has highlighted the difficulty of leaving a sustainable benefit when the mine closes

24 Minera Yanacocha Peru Yanacocha is the largest gold producer in South America, with six open pit mines, four leach pads, and three gold recovery plants. The mine employs over 8,000 workers. There are more than 150 small villages surrounding the mine.

25 Local Pressures and issues Unfulfilled commitments Concerns about environmental performance. Lack of effective engagement. Complex and under resourced governance at local and regional level. Past mistakes: 2000, a mercury spill in Choropampa; 2004, community protests leading to Newmont suspending its exploration activities at Cerro Quilish; 2006, an incident in which a local farmer from Combayo was shot and killed during a community protest;

26 Stakeholder concerns about the mine s lack of accountability for past mistakes. There is a perception that managers at the mine and at the regional office in Lima do not feel responsible or accountable for the mine s community relations performance. Historically, the mine has not effectively engaged with rural stakeholders. External stakeholders are very concerned about the mine s impact on water quality and quantity Structures and processes have been put into place but struggle to provide effectively resolve conflict

27 The Australian Mining Context Mining Industry Attitudes and legacy - the 90s and Native Title battles Cultural baggage - local prejudices and misunderstanding Our perspectives in the industry reflect the racist experience that has been Australia s past. Lack of capacity and understanding

28 Indigenous Nations of Australia Based on the Tindale Maps SA Museum

29 Like broader Australian community, Aboriginal Australians desire control over their lives, cultural strength, functional communities and real jobs in the real economy.

30 Convergence of interests Exploration occurs on Aboriginal Land When we mine we are tenants on the Aboriginal Land Demographics and the industry Business Imperatives for a strong regional employment base Sharing the benefit new economic models out of the economic ghetto.

31 The Challenge an example: The Northern Territory Tanami Operations km NW Alice Springs 10% Indigenous Employment, but not local 3 small local communities km from mine who have land associations and responsibilities across whole region Local Employment and Business development commitments Issues: work readiness, health, education, community capacity building, mentoring, wealth sharing, small business start up, governance, failure of government Strong agreement making processes but significant gaps in implementation and effective dispute resolution

32 Corporate Community Leadership Program - India The CCLP came out of discussions between Oxfam and BHP who knew they had significant gaps in their capacity in social relations. Newmont participated in the second program. They were interested in a relationship with Oxfam CAA that would improve their ability to understand the interplay between community, society, corporate, government and development in a changing world. The program was developed to give people a view about civil society from the perspective of Non Government Organizations in a developing country. It was run in 2002 and 2003.

33 Issues for Orissa Communities Access to water and quality of water Education and the future of children The role of women in the development of the village Pressures from development forcing them to change Fear for the future For villagers still on traditional land the fear of others trying. to take their resources, and for those who have been displaced the fear of being unable to find a livelihood

34 Village Issues Lack of power in the political process Anger about the destruction of the way of life Anger that are people getting rich while they pay a terrible price

35 On the doorstep

36 Retrofitting and new models Training for those in the field eg UQ: targetted courses in CD/CR, eg Oxfam CCLP Changing undergraduate and post graduate industry core degrees geology, mine engineers, MBAs Broader understanding of core capabilities needed for success in resource development Many companies run internal training there are huge opportunity for partnerships, cross sector links

37 Navigating a balance between the expectations raised by the promise of development and the challenges posed by the footprint and resource needs of mining sites is a critical challenge

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39 Big Questions How do companies best work with communities to support their aspirations while building a strong business what does sustainable development, justice and effective conflict management really mean? Building skills and capacity within the company, industry and governments as well as communities How do we create longer time frames within the pressures of quarterly results, production targets and market realities? How do communities engage across the supply chain? How do we develop more robust shared processes, structures and metrics that work at a local level?

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