What is the politics of CSR?

I had the pleasure of hosting our departmental seminar last week where we had Dr. Dinah Rajak from the University of Sussex speaking. Dinah has written a very interesting book, In good company, which gives an ethnographic account of CSR in Anglo American from their London HQ to their platinum operations in Rustenberg.

To cherry pick from a rich and stimulating book, one of the most interesting parts of this is her argument about how the global expansion of CSR reconfigures the power and politics of business’ activities in the developing world. CSR increases the power of companies by expanding their influence to new spheres and allowing them to access new resources such as expertise and relationships with political groups while simultaneously deflecting criticism of their operations.

At Manchester, Dinah was speaking to some of her more recent work which looks at scholarship programmes promoting entrepreneurship implemented by Anglo. Here, Dinah argued that these competitive training schemes helped diffuse the potential political tension and challenges of operating a high tech mine with a small labour force surrounded by a large population of unemployed. A political move that was highly problematic in the ways it shifts responsibility for poverty and unemployment on to the individual away from, say, the state, or the mining company for that matter.

All food for thought about the political role of CSR in mining. This is, of course, central for many criticisms of CSR which argue it should be seen as ‘greenwash’ or a ‘smokescreen’ deflecting criticism of the disruptive effects of mining and little more. Of course, despite industry protests to the contrary, CSR is frequently a political intervention (otherwise it couldn’t be sold as ‘risk management’ as it so often is). Companies operate in a (often, highly) political context and CSR is one tool they use to manage this. But can we say a CSR programme is a ‘good thing’ if it has potentially regressive political effects? We clearly have to be careful of this but I think balance that needs to be struck is between critiquing these possibilities (while not assuming that they are so – surely CSR can stimulate criticism as much as it can placate it?) and supporting companies to find potentials for progressive politics in their CSR initiatives. Helpfully, Dinah offers an approach and language for engaging with the political dimension of CSR critically without defaulting to total rejection of mining company efforts. A welcome intervention indeed.

Is the Canadian experiment failing?

News last week of another failed mediation for Canada’s Corporate Social Responsibility Counsellor for the Extractive Sector raises questions of whether this mechanism can ever really work in its current form.

Seen as a possible model for what other countries could do in this field it represents an interesting compromise between entirely self regulated CSR and law-based government regulation and is being watched around the world. This ‘Counsellor’ model was a watered down version of a previous recommendation for an independent ombudsman which had powers of independent investigation and reporting and could publish findings. The CSR Counsellor as constituted was primarily pitched as a mediation mechanism – if either party decided against being a part of the process, the CSR Counsellor could not proceed with the case. Which is what happened last week. Again.

The CSR Counsellor has become a compromise that pleases nobody.

On the surface, its harder to think of a better argument against voluntary CSR. Here is a pretty toothless mechanism for dealing with CSR issues arising from a nation’s mining companies overseas being repeatedly ignored or boycotted by mining companies. The mechanism awards veto power to either party and they use it. Mining companies eschew even modest oversight and accountability. MiningWatch Canada is calling for the counsellor to step down and replace the entire mechanism with something less fundamentally flawed.

There’s clearly something to be said for this but perhaps Canadian mining companies have reason to be skeptical. For a start, mining companies I have spoken to think the Counsellor will always side with the local community against the mining company with one executive saying that Marketa Evans (the Counsellor) had said as much in a meeting with mining companies. Whether or not this is true, it clearly reveals the deep suspicion with which mining companies treat the mechanism. Believing this to be true, no mining company in their right mind would enter into this process if they could possibly avoid it. It is pure liability and only likely to end in further antagonising community relations, bad press and their share price taking a hammering. We’re missing Silver Standard Resources’ explanation on why they backed out of the process, and they apparently see no need to mention it on their website, so we really don’t know what’s happened in this most recent case.

Maybe we do need a new CSR Counsellor who better commands the trust of the Canadian extractive sector but I don’t think we can pin the blame for the failure of the CSR Counsellor on Marketa Evans personally, as both sides seem keen to do. The problem is that the divisions in the mining companies/CSR debate are often so deep and bitter in Canada it is near impossible to imagine any person or institution which could satisfy all parties. Marketa Evans was clearly a choice aimed at assuaging the worries of the mining sector, with a background in banking and the Munk School of Global Affairs (funded by Barrick Gold Chair, Peter Munk). This was not enough to encourage mining companies to use the process. Anyone even more obviously sympathetic to the mining industry would likely face a barrage of criticism before they even began (as Marketa did) and do nothing to restore wider legitimacy to the mechanism.

Personally, I’m dismayed at this state of affairs. By most standards, the CSR Counsellor has failed in it’s mandate. No one will trust mining company accounts of conflicts, or their CSR reports and efforts, until they are subject to unbiased scrutiny. Mining companies running away at the first attempt at this in Canada just looks bad. This lack of engagement in the mechanism and no obvious improvement on the horizon really shows that more must be done to foster mining company engagement in the mechanism. Maybe a new hand at the wheel would help do that and help reshape the office into something more useful for all involved. I suspect however that what’s required is some real government backing to bring people to the table. That, and some teeth. If mining companies felt they had some real stake in how this mechanism operated, I suspect it would begin to look a lot more useful than it does now.