Industry & Sustainability: “Mining industry should review business models, CSR collaboration” – Minister

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Sustainability

With the mining industry now recovering from the downturn in commodity prices, and a new balance emerging in the global demand and supply of minerals, now is the time to reflect, innovate and plan for a more resilient industry in the future, says SA Mineral Resources Deputy Minister Godfrey Oliphant.
Speaking at the Implementing CSR Strategies in Mining conference, in Johannesburg, on Tuesday, Oliphant noted that the industry needs to review its business models to ensure that they are more sustainable, efficient and more able to withstand challenges.

 

In addition to urging the industry to sustain and enhance investment in areas that will support the industry in future – such as skills development, the acquisition of geological information and the establishment of systems and economic infrastructure – Oliphant emphasized that the gaps between miners, the government and communities needed to be closed.

“It is only by collaborative efforts that we can protect and grow the mining industry in a sustainable manner in future,” he said.

Oliphant highlighted the significance of corporate social responsibility (CSR) by underscoring the clear, “raw need” for mining companies to ensure their credibility for a social licence to operate.

He suggested that understanding the advancing economic aims of the local economy, local procurement and an investment in beneficiation and local infrastructure is a critical indicator of companies’ willingness to engage in mutually beneficial transactions and operations.

Oliphant noted that, in this context, the role of CSR could indeed be “catalytic”.

However, he reiterated that “effective CSR can be achieved only when the entire business philosophy, mining operationsand management culture are coherent and so structured to offer balanced treatment of capital investment, safe and humane treatment of the workforce, sustainable care of the natural environment, and general consultative engagement with the surrounding communities to ensure growing trust and respect for the mining activities”.

From the dialogue held on Tuesday, which explored how to enhance the impact of CSR for the benefit of the mining industry and its stakeholders, key suggestions were made.

In discussing the importance of CSR, High Commissioner of Canada to South Africa Sandra McCardell noted that the concept of CSR can be seen as ambiguous and the implementation thereof can fluctuate depending on certain factors within the environment.

“Industry needs an appropriate framework to ensure a level playing field for all participants in compliance with all CSR requirements. This sort of framework needs to be a collaboration between industry, government, and local communities,” she suggested.

During the discussion, panelists all cautioned that mining may not be feasible, or may even be without a future, unless issues between mining companies and communities are addressed.

Social Surveys Africa CEO Bev Russell believed the prevailing concept of CSR to be deeply flawed, cautioning that CSR should be “at the heart of mining companies”, and “not a patchwork quilt of projects but an integrated response”.

Russell stressed the need for a deep understanding of community issues to allow for meaningful engagement with communities.

Montero Mining CEO Tony Harwood, however, highlighted that all parties do aim to maximise on the benefits they can provide to CSR initiatives.

Referencing Benchmarks Foundation executive director John Capel, Harwood enthused the need for “quantum change”.

“And [quantum change] is a dialogue. We need a dialogue that will bring communities, and mining communities, around the table to create sustainable development to achieve an outcome,” Harwood said, acknowledging insufficient dialogue between interested parties.

The panellists also agreed on the need for collaborative efforts between mining companies, government and communities in implementing and progressing CSR strategies.

Chamber of Mines Public Affairs and Transformation senior executive Tebello Chabana, who noted the challenges in a lack of a collaborative regional focus in CSR projects, suggested the need for enhanced, long-term planning, as well as the need to break down the barriers to collaboration.

Meanwhile, Benchmarks Foundation executive director John Capel emphasised the need for “a game changer” and to accept changes in the implementation of CSR strategies.

Nonprofit organisation Seriti Institute cofounder Gavin Andersson emphasised the need for accountability in CSR – from the mining company boards and executive directors, as well as from the community and interacting practitioners.

He further argued that shareholders and various stakeholders in the mining industry should be educated on the complexity of CSR.

“We have to provide incentives for people in mining houses, as well as for the people in the communities to learn together,” he said.

Canadian gold producer B2Gold MD and Namibia country manager Mark Dawe emphasized that CSR should not only be seen as a responsibility but as an investment.

He suggested ways to change the entire paradigm in CSR strategies, to make it effective, which include the establishment of a sovereign fund, similar to that of Botswana or Norway.

“We need to have a national fund which is managed through the Chamber of Mines,” he said, noting that the funds should be drawn from royalties and not corporate taxes.

Dawe averred that mining companies should be forced to adopt the principles of corporate governance.

“CSR is not dispensable. When the going gets tough, which it will, you don’t turf out CSR projects, it’s very much part of the business. Your bankable feasibility includes CSR as a priority and a necessity for doing business,” he averred.

Dawe’s suggestions included mining companies engaging with communities to identify and clarify their specific needs and to ensure that those needs are assessed.

He further warned mining companies not to tackle projects that may be unsustainable.

Gold producer Sibanye-Stillwater stakeholder engagement head and senior VP Thabisile Phumo added that miningcompanies needed to learn to tell their stories, as they are not always understood from a technical and social perspective, in that communities do not understand how the business works and, if they did, they could better leverage contributions from mining companies.

She also underscored the need for ‘vision-setting’, as she believed communities can rally behind these visions.

Russell meanwhile emphasized the need for a trusted credible disaggregated database, which the mines/mining companies, communities, and municipalities could trust.

She further suggested applying an independent monitoring of CSR projects at the community level to monitor success, as well as measuring the social and political licenses of municipalities to improve the trust between the parties.

“If the industry has those benchmarks, it will give us an ongoing nice measure,” Russell averred.

The panelists further suggested the need for CSR strategies to be brought to a regional level, believing it to be critical that mines at a regional level work together in collaboration with municipalities and communities.

Delegates, meanwhile, suggested that relevant third parties, such as chambers of commerce, talk on behalf of mines and communities as this would benefit the mines and communities.(Source: Miningweekly)

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