Mining Environmental and Social Responsibility

Mining is one of the oldest industries there is and for good reason: the resources these firms extract are essential for practically every good and service we enjoy, directly and indirectly. There will continue to be mines for most elements as there is and will be for some time more demand for the products and services that the materials go into than what can be recycled and conserved. Even recycled steel melted in electric furnaces often needs bars of pig iron, created in coke (converted from coal)-fired blast furnaces.

While mining, like many industries, do pollute through both generating emissions and scouring and despoiling the earth, there is nothing intrinsically totally ‘black’ about it; holes can be filled or lessened and tailing ponds can be minimized and cleaned up. Greener processes can be brought in to lessen the environmental impacts.

Alas here is the rub. Too many mining companies don’t want to pay for the mess they make, witness the blowing up of West Virginia mountaintops, the Alberta oil sands ponds, citing ‘costs’ that they instead download to the rest of us to subsidize. Good business sense, perhaps, nonsense for society as a whole.

Yet as bad as mining practices may be in North America they are sylvan compared to those in developing countries. There, mining firms basically have carte blanche and too many of them take advantage nonexistent or ignored environmental and labor laws amidst massive corruption and grinding poverty in which individuals are willing to work in Hades just to live an abbreviated, painful existence. Much like they behaved up until the middle of the last century in the more developed nations, as any tour of a mining museum or a conversation with an elderly ex-miner or a read of George Orwell’s The Road to Wigan Pier will tell you.

To prod the mining companies overseas there is now proposed legislation, Bill C-300, a private member’s bill introduced in the Canadian House of Commons by John McKay, a Liberal Member of Parliament who I met a few weeks ago at an Olympic party in a Vancouver suburb. As Canada fought then won what turned out to be an exciting nail-biter of a game against Slovakia, so it could earn the right to face the U.S. for the gold medal, Mr. McKay and I talked about making mining firms responsible for extracting resources like gold.

McKay’s bill is aimed at promoting responsible environmental practices and international human rights standards on the part of Canadian mining, oil and gas corporations in developing countries.  Its purpose is to “ensure that corporations engaged on mining, oil or gas activities and receiving support from the Government of Canada act in a manner consistent with international environmental best practices and with Canada’s commitments to international human rights standards. The Act gives the Minister of Foreign Affairs and the Minister of International Trade the responsibility of holding corporations accountable for their practices by submitting annual reports to the House of Commons and the Senate for review.”

The bill has been analyzed by Prof. Richard Janda at the McGill University Faculty of Law. Here is his take on one of the key contentious issues and that is whether the legislation–which Mr. McKay told me has not to no surprise been exactly applauded by the mining industry–will actually hurt mining businesses:

“There is no evidence that Bill C-300 will unfairly disadvantage Canadian extractive companies and in fact, there is strong reason to believe that the opposite is true. It is more likely to create a regulatory environment that would make Canada and Canadian extractive sector companies world leaders in the area of CSR [Corporate Social Responsibility], resulting in a competitive advantage for those Canadian companies when operating internationally. Research has shown that companies that are socially responsible–both due to mandatory measures and through complementary voluntary action– gain certain advantages over competitors that do not have in place CSR policies and programs.

“Some of the areas of competitive advantage arising from CSR include:

* Cost savings, improved productivity and operational efficiencies
* Improved risk management
* Positive effects on employee recruitment, retention, and motivation
* Attracting customers and investors
* Improved relations with the local community; and
* Better access to lenders and insurers.

Bill C-300 survived the Harper Conservative government’s decision to prorogue i.e. close and then to reopen Parliament under House rules, but whether it goes anywhere remains to be seen. Few private members’ bills ever get passed into law, and the Harper regime whose political core lies in Alberta, haven’t been cheering it on. The legislation is now in the hands of the Standing Committee on Foreign Affairs and International Development for further study.

Even if Bill C-300 dies that such legislation has been introduced and has been the subject of serious discussion and analysis, is a necessary first step–for other bills will follow until one gets passed–in what will be a long road to getting the mining industry to clean up its act, one that will pay off more even to these businesses than they will ‘lose’.

Tags: corporate social responsibility, environment, green practices, legislation

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