Mining and Corporate Social Responsibility - Lecture at University for Development Studies, Wa, Ghana

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Corporate Social Responsibility (CSR) has become an important strategic issue for companies around the world, especially those companies working in the extractive sector. When it is done well CSR can create value and opportunities for companies, communities, local governments and a range of other stakeholders. When it is absent, or not done well the opposite can be true. This lecture will cover:
Definition CSR and Social Investment;
The rationale and driving forces for CSR and social investment;
Understanding of relevance of CSR to business and development community;
A brief description of three case studies on mining and CSR
What does CSR mean for Wa and UWR

About the Lecturer
Wayne Dunn is an award winning global expert on corporate social responsibility. In the past two decades he has led more than forty CSR projects in over thirty countries across six continents, helping clients to innovate and succeed in difficult and challenging circumstances. His work has won prestigious global awards, including the first CSR project to ever win a World Bank Development Innovation Award. His projects been developed into lectures and case studies and one was even featured on the front page of the Wall Street Journal. In the 1990s he helped lead a paradigm-shifting transition that facilitated exponential increases in indigenous business and economic development throughout the Americas. More recently he has been a practical pathfinder helping businesses to successfully integrate social and economic value creation into their business models.
Wayne is a founding member of the Leadership Council of McGill University’s Institute for the Study of International Development (ISID). He is a frequent lecturer worldwide on business and economic issues, and also provides volunteer support to numerous local, national and international organizations. This includes serving as the Vice-Chairman of the Canadian Council on Africa, on the Advisory Council to the University President and on the Board for the University of Winnipeg’s ground-breaking Master’s Program in Development Practice. He is a Stanford University Sloan Fellow and holds an M.Sc. in Management from the Stanford University Graduate School of Business. He is married to Gifty Serbeh of Wa and he and his family maintain close links to Ghana.
www.waynedunn.com http://en.wikipedia.org/wiki/Wayne_Dunn

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Mining and Corporate Social Responsibility - Lecture at University for Development Studies, Wa, Ghana

  1. 1. UDS Lecture on CSR and MiningBeyond the Gate: CSR & Mining University for Development Studies Lecture on CSR and Mining October 31, 2011 Wa, Upper West Region, Ghana Presented by: Wayne Dunn www.waynedunn.com info@waynedunn.com
  2. 2. UDS Lecture on CSR and MiningLecture Objective and OutlineDefine CSR and Social Investment;Discuss rationale and driving forces forCSR and social investment;Develop understanding of relevance ofCSR to business and developmentcommunity;Brief description of three case studiesWhat does it mean for Wa and UWRQuestions and discussion.
  3. 3. UDS Lecture on CSR and Mining How Can UDS Help?UDS well placed to play an important roleMining companies have a difficult challenge to implementCSR. Even those that try very hard often have problemsEducational and Development Institutions must learn howto work with and educate mining companies and localcommunitiesMining companies must learn how to work with andeducate development and educational institutionsA great opportunity for collaboration and synergy
  4. 4. UDS Lecture on CSR and Mining What is CSR?Corporate Social Responsibility (CSR)A concept whereby companies integratesocial and environmental concerns intotheir business mission and operations, and in their interactions with stakeholders.
  5. 5. UDS Lecture on CSR and Mining DefinitionsCorporate Social Responsibility (CSR), Sustainable Development, Socialprograms, Community RelationsTerms are often used interchangeablyDefinition“CSR is the continuing commitment by business to behave ethically and contribute toeconomic development while improving the quality of life of the workforce and their familiesas well of the local community and society at large” Corporate Social Responsibility (Sustainable Development) Financial Social Environmental Responsibility Responsibility Responsibility WBCSD Diagram
  6. 6. UDS Lecture on CSR and MiningThe New Reality of Business
  7. 7. UDS Lecture on CSR and Mining CSR is a Global Phenomena“By working together to mobilize sustainable investment in the Least Developed Countries, government, business and civil society give hope and opportunity to the world’s poorest” Kofi Annan UN Secretary-General
  8. 8. UDS Lecture on CSR and MiningCorporate Social Responsibility is… Companies working in partnership with communities and others to address problems; Companies promoting good values to their employees, Community suppliers, customers, partners; Companies investing in social and economic development; Companies being good corporate citizens; Companies being good neighbours
  9. 9. UDS Lecture on CSR and Mining Why is CSR happening?Globalized world is demanding more of business… Global media – The CNNization of the world – remote local issues direct to television screens Proliferation of NGOs and CBOs – direct, well organized and financed support to communities Internet and other communications innovations – direct communications from remote projects to worldwide audience Global Democratization – increased attention to local issues
  10. 10. UDS Lecture on CSR and Mining Why is this happening (cont)Comprehensive Codes Canadian Business for Social Responsibility Guidelines for Corporate Social Performance Caux Round Table Principles for Business Clarkson Principles of Stakeholder Management Code of Ethics on International Business for Christians, Muslims and Jews Elements of a Corporate Accountability Convention (Friends of the Earth) Ethics Compliance Management System Standard ECS2000 Global Sullivan Principles of Social Responsibility The GoodCorporation Standard International Code of Ethics for Canadian Business International Finance Corporations Performance Standards on Social and Environmental Sustainability ISO CSR Standard OECD Guidelines for Multinational Enterprises Principles for Global Corporate Responsibility: Bench Marks for Measuring Business Performance Social Venture Network Standards of Corporate Social Responsibility UN Code of Conduct on Transnational Corporations UN Global Compact
  11. 11. UDS Lecture on CSR and Mining Why is this happening (cont)Comprehensive Codes Canadian Business for Social Responsibility Guidelines for Corporate Social Performance Caux Round Table Principles for Business Clarkson Principles of Stakeholder Management Code of Ethics on International Business for Christians, Muslims and Jews Elements of a Corporate Accountability Convention (Friends of the Earth) Ethics Compliance Management System Standard ECS2000 Global Sullivan Principles of Social Responsibility The GoodCorporation Standard International Code of Ethics for Canadian Business International Finance Corporations Performance Standards on Social and Environmental Sustainability ISO CSR Standard OECD Guidelines for Multinational Enterprises Principles for Global Corporate Responsibility: Bench Marks for Measuring Business Performance Social Venture Network Standards of Corporate Social Responsibility UN Code of Conduct on Transnational Corporations UN Global Compact
  12. 12. UDS Lecture on CSR and Mining Shareholder Pressures‘Socially conscious’ shareholdersSocial Investment Funds– Socially responsible investment refers to making investment decisions based on a company’s social and environmental practices and on their corporate values and ethics).The Financial Markets– Dow Jones Sustainability Index (http://www.sustainability- index.com/)– FTSE Sustainability Index (FTSE4Good) http://www.ftse4good.com/– Domini 400 Social Index (DSI) http://www.domini.com/
  13. 13. UDS Lecture on CSR and MiningPressure: Consumers, Customers
  14. 14. UDS Lecture on CSR and Mining Social LicenseAn emerging phenomenaIn addition to more traditional state issueslicenses and regulatory approvalsBased on the principle that communities andlocal interests have a valid role in determiningwhether or not a project will proceedCommunities have inserted themselves into theregulatory approval/permitting process and caneasily disrupt operations that they disapproveof
  15. 15. UDS Lecture on CSR and Mining Why focus on social licenseSocial Performance is key to FinancialPerformance“In a transparent, globalized world, economic performance,environmental performance and social performance hang together.Business is realizing that it has become an integral part of societyand now has wide-ranging responsibilities… shareholder value andsocial responsibility support each other”Göran Lindahl, President and CEO Asea Brown Boveri (ABB)“Our commitment to community development “represent(s) anadded cost, but is an essential investment in our future…(and)should help us to achieve greater profitability”.Jay Taylor (former) CEO Placer Dome
  16. 16. UDS Lecture on CSR and MiningWhy focus on social performance “Seven of the top ten U.S. home improvement retailers, including Home Depot, have issued restrictive lumber buying policies in the wake of an aggressive campaign by environmentalists While industry is still sorting exactly what this means, there is no doubt that it threatens a significant share of the traditional market for BC forest products.” Globe and Mail – Aug 25, 2000 “social responsibility is a matter of hard-headed business logic” John Browne, CEO British Petroleum
  17. 17. UDS Lecture on CSR and Mining CSR is a Value Strategy Share price of a CSRfailure that rendered a multi-billion dollar reserve un-developable Good CSR creates value for company, ~$13.00 $0.29community and other stakeholders
  18. 18. UDS Lecture on CSR and Mining CSR and MiningMining is and has been on both ends ofCSR performanceSome of the most innovative andexciting CSR projects ever have beendriven by mining companies (coming incase studies)Mining has had some of the worst CSRshortcomings ever too
  19. 19. UDS Lecture on CSR and MiningThe Mining World Has Changed “We are determined to provide multi-skilling to workers and assist them to cope with retrenchments. This is a must and not a choice for industry” “It is important for mining to ensure that economic benefits accrue to society as a whole and more specifically to communities affected by mining . . . The social environment has not, in my opinion, been adequately addressed in the past” Hon. Phumizile Mlambo-Ngcuka South Africa Minister of Minerals and Energy
  20. 20. UDS Lecture on CSR and MiningCSR IS about value in MiningBougaineville - corporate practices weredirectly implicated in provoking civil war,allegedly cost Rio Tinto $3 billion (StanfordUniv study)Tambo GrandeOvacik/Eurogold (vs Kislidag’s success)Saskatchewan Uranium Industry
  21. 21. UDS Lecture on CSR and MiningThe Mining World Has ChangedSocial issues are asimportant asTechnical Issues
  22. 22. UDS Lecture on CSR and MiningMining IS a Development Business Mining industry is amongst world leaders in creating local value from investments and operations. Sustainable Development and Corporate Social Responsibility will continue to grow in importance.
  23. 23. UDS Lecture on CSR and Mining Beyond Beads ‘n TrinketsTo create bottom line value CSR must createmeaningful development value in areas such as: – Poverty Alleviation – Community Health – HIV/AIDS – Rural Development – Local Capacity Development – Infrastructure Support Value Created is not measured in money spent
  24. 24. UDS Lecture on CSR and MiningSD/CSR Implementation Challenges more than a warm fuzzy issue Spending isn’t the answer ?Results? Framework Plan System Solving social problems Objectives
  25. 25. UDS Lecture on CSR and MiningSD/CSR Implementation Framework Advice to Mining Companies Focus on Value Creation Be systematic and integrate with overall development objectives of the country/region Catalyst for Development – development partnerships Accept that there will be negative impacts (e.g. AIDS) Build from local strengths / mitigate local weaknesses Begin closure planning NOW Build international relationships Communication is critical – appropriate and strategic Bring the industry along with you Quantify objectives and results
  26. 26. UDS Lecture on CSR and Mining Some Examples (deliberate use of non Ghanaian examplesPlacer Dome South Africa Poverty alleviation HIV/AIDS Capacity developmentEldorado Gold – Kisladag (Turkey) Poverty alleviation Environmental rehabilitation Rural development Capacity developmentPorgera (PNG) Infrastructure Rural Development. National HIV/AIDS Strategy Closure Planning Approach
  27. 27. UDS Lecture on CSR and Mining Placer Dome Care ProjectOriginal objective – mitigate the social andeconomic impacts of retrenchment and assist 70%of family units to become economically activeInnovative rural development and HIV/AIDSprogram, delivered at community level across 3.5million sq km of southern Africa– Extensive involvement of women and families– Pioneered new 13 step process with extensive counseling, training and support. (Process is being copied by other development programs in the region)
  28. 28. UDS Lecture on CSR and Mining Placer Dome Care ProjectHIV/AIDS program won prestigious Development InnovationAward at World Bank’s Development Marketplace– Over 2,400 development projects from 122 countriesCSR can create real development value
  29. 29. UDS Lecture on CSR and Mining Mining & HIV/AIDS Current reality Mining Outreach Partnership Helps to mitigate the social and economic impact of AIDS Healthy worker Virtually no support for families in rural villages leaves village Challenge is too vast for any Financially sustainable throughfor employment single company to address fee for service approach Scalable beyond the mining industry Training, Support and Medical Supplies Family Assist Family to Employed Medical Family and Counselling Worker becomes Care for terminally ill Worker Repatriation Community and HIV Positive and Supporting Terminally Ill Prepared to Integration Eventually develops Extended Man Returns Recieve with AIDS Care Process assists Family To Village Worker Community Family member to Services Develop alternative Economic Opportunity Without intervention the worker goes home to overwhelm family who have no support and no means of economic sustainabilty
  30. 30. UDS Lecture on CSR and MiningEldorado Gold - Kisladag Project (Turkey) Strategic approach to use mining project to facilitate sustainable rural development Development of agriculture related industries and infrastructure; Increased involvement of women; Improved grazing and land management (reduce desertification) 10 years of mining production in harmony with local communities. Huge value for all stakeholders Contrast with Eurogold project next door
  31. 31. UDS Lecture on CSR and Mining Porgera (Papua New Guinea)Working to leave behind asustainable community– Development of local, non- mine related, business– Creation of local infrastructure to support a sustainable community after the mine leaves– National HIV/AIDS PPP Strategy– Innovative closure planning
  32. 32. UDS Lecture on CSR and MiningPorgera Closure Framework
  33. 33. UDS Lecture on CSR and Mining SummaryWhy Because it is smart business and creates/preserves business valueHow not Don’t simply throw money at social issuesHow Systematic and Value Creation Focus Measure, Measure, MeasureExamples South Africa, Turkey, Papua New Guinea
  34. 34. UDS Lecture on CSR and Mining Main Point CSR isabout valuecreation not Charity
  35. 35. UDS Lecture on CSR and MiningMining is coming to Ghana’s north Mining concessions in Upper West and Upper East Regions
  36. 36. UDS Lecture on CSR and MiningAnd to the Upper West
  37. 37. UDS Lecture on CSR and MiningAzumah Resources
  38. 38. UDS Lecture on CSR and Mining Making CSR Happen• Azumah’s mining development is an opportunity to get it right;• Mining can create beneficial value for companies, people, community and environment;• Or it can create a social, economic and environmental mess;• How it turns out is not just the mining companys responsibility.• All stakeholders must engage and help to make it work
  39. 39. UDS Lecture on CSR and Mining Lecture Objective and Outline• Define CSR and Social Investment;• Discuss rationale and driving forces for CSR and social investment;• Develop understanding of relevance of CSR to business and development community;• Brief description of three case studies• What does it mean for Wa and UWR• Questions and discussion.
  40. 40. UDS Lecture on CSR and MiningQuestions and Discussion
  41. 41. UDS Lecture on CSR and MiningBeyond the Gate: CSR & Mining University for Development Studies Lecture on CSR and Mining October 31, 2011 Wa, Upper West Region, Ghana Presented by: Wayne Dunn www.waynedunn.com info@waynedunn.com

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