Brexit, mining and CSR

All this recent news about Brexit has reminded me of this article in The Times (behind a paywall – apologies). It tells the story of one of the areas which voted for Brexit. As we now know, these were often rural areas which are relatively poor for whom foreign labour threatens wages, jobs and services. This article was one of many in the weeks following the vote where the London-centric media tried to figure out what the hell had just happened to them by dispatching unsuspecting correspondents to far flung corners of the nation (to which they never then returned, but it’s the thought that counts, right?). What stood out to me though was that this story was based in the formerly prosperous (and oddly famous) town of Grimethorpe, South Yorkshire. Prosperous that is, until the mines closed.

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The Grimethorpe Colliery Band

The story of mine closure leading to decline and poverty, as friend of the blog Dylan McFarlane tweeted recently, is a global one. Dylan was pointing to a recent article on The Conversation telling the story of mining towns in Guinea. These towns had seen limited prosperity and a great deal of inequality as the benefits of Bauxite extraction had not been widely shared.

So far, so familiar. Mine closure, it turns out, is one of the thorniest issues facing mining companies looking to improve their social and environmental impact. One answer I saw in Ghana is the creation of foundations which pay a percentage of company profits into a fund a proportion of which only pays out when the mine closes. Even these, I suspect, will only slightly soften a very sharp drop in economic prosperity.

In Europe, sudden drops in economic prosperity have historically been associated with a shift towards populist, nationalist leaders and rhetoric that we are currently witnessing. As surprising as Brexit was for London-based elites, its seeds were sown in the industrial and mining policy of the 1980s. This all raises the question of what difference might have well managed closures made? If today’s best practices had been adopted 30 years ago would things be different? Would Grimethorpe be prospering and actually in need of foreign labour? (My inner pessimist makes me think this is unlikely, CSR seems only to be able to do so much)

For those of us interested in mining and CSR, the Brexit vote should renew attention on the long term political consequences of mine closure. The effects of mine closure and decline are an important but under-researched area. The mining industry has just seen a marked global downturn as the decades-long commodities boom came crashing to a halt. Hundreds of thousands have been laid off and many mines closed. As a result, telling the story of Grimethorpes around the world is more pressing than ever.

Image from The Guardian.

A Modern Magna Carta?

Latin for ‘CSR’?

There was an excellent documentary on BBC Radio 4 last night about a ‘modern Magna Carta’. The opening question was, broadly, if 800 years ago the Magna Carta was written to curtail the excessive power of the king, where does power that needs to be curtailed lay today?” The unanimous answer being: large corporations. Cue lots of discussion about what and how would be the best ways to engage with and regulate large international corporations with all manner of interesting people. Well worth a listen if you’re in the UK and it should be available as a podcast as it’s Radio 4’s Documentary of the Week.

Upcoming conference on mining in Africa

In late April I’ll be presenting some of my work on CSR and global standards in the mining industry at a conference at Edinburgh University on ‘Mining and Political Transformations in Africa’. Do come along! The deadline for abstracts has passed but you can still register to attend and, from what I’ve seen of the line up, it looks to be a very interesting conference with representatives from both industry and academia.

Speaking of changing expectations…

Energy companies are getting it in the neck here in the UK for their recent price rises of 10%. It’s an interesting one this and really shows that when it comes to certain things, it’s not just a matter of ‘getting the prices right’. I was at a seminar with visiting Hallsworth Professor Mike Muller on water regulation last week and one of the central contentions we were discussing was around attaching prices to things people have a ‘right’ to. At some point down the line this lands you in trouble. Thus energy companies are caught in the conflict between a regulatory system set up in the 1990s that mediates value (what some thing is worth to people or a society) through a single metric: price, and a social expectation that the poor should not die of cold simply because they are poor. We’ve got to be able to find a better way of managing this tension than shifting the burden of decision making entirely onto the private sector.

It is delicious irony that a former oil executive is leading the charge arguing the companies must be “conscious of their social obligations” and “behave with generosity and not merely to maximise opportunity”. Read the full interview over at The Daily Mail, see also their ‘Morals not Markets’ leader column to get a clear sense of the changing expectations on companies in the UK.  The Daily Mail making a forceful case for socially responsible companies? You saw it here first.

To get a smidge academic for a moment, this really reminds me of Karl Polanyi’s ‘The Great Transformation’ which (spoiler alert) argues that a key limit of liberalised capitalism is people’s appetite for the suffering of their fellow citizens. People don’t want to see their compatriots starve. Thus there is a ‘double movement’ where the thrust of liberalised capitalism is pushed back by the moral outrages of a society that believes all have the right to live. We could say this is what’s happening here. Not that I expected The Daily Mail to be at the forefront of the Polanyian ‘push back’, but I am happy to be surprised.