Corporate Social Responsibility in the corporate world is perceived more as a charity or as a philanthropic activity than as a responsibility. Some good deeds to the community are done merely
It is because Mining companies have not taken this responsibility seriously that they have earned for themselves a disrepute so deep that it has resulted in bans and legal excesses that has slowed the whole industry to a limp. Take the mining bans in Goa, and the problems that Vedanta has been facing in Orissa and Tamilnadu. CSR programs in the mining industry are one way to compensate communities for the social and environmental costs associated with mining.
What is Corporate Social Responsibility?
Let’s look at some textbook definitions :
“The process of communicating the social and environmental effect of organization economic action to particular interest group within the society and society at large” – Gray
“Disclosure of those cost and benefit that may or may not be quantifiable in monetary terms arising from economic activity and subsequently born by community at large or other stakeholders” -Perk
“CSR is the concept whereby companies integrate social and environmental concern in their business operation and in their interaction with their stockholders on a voluntary basis.” – EU Commission
In simple terms we may say that Corporate Social Responsibility refers to a company’s voluntary actions to either reduce the negative impacts of mining or to improve the living conditions of the local communities where they operate. Indian National Voluntary CSR Guidelines revised in 2011 outlines nine principles which companies must follow to effectively carry out their social responsibility. These include issues of ethics, accountability, transparency, human rights, environment, well-being of employees, responses towards marginalised and vulnerable groups, equitable growth and development, and providing value to customers and consumers.
How can Indian Mining companies do CSR better?
- For CSR programmes to be successful companies must accord the highest priority to stakeholder engagement. And they must engage with all the stakeholders including investors, employees, customers and most importantly the entire communities in which they operate.
- The CSR programmes must be seriously planned and implemented right from day one of the mining project. Listening to community members , getting to know their concerns and needs and taking them into the decision making process right from the beginning promotes transparency and helps the company build trust in the company. Most of our companies make the mistake of focussing on CSR only when it gets too late. Their focus at the outset instead is on getting permits and meeting legal requirements. Even Community engagements are done out of compulsion rather than out of a sense of concern and responsibility for the community. And so naturally distrust and conflicts crop up when the operations go full swing and explorations begin. A CSR programme that is pro-active and transparent helps the companies be seen as agents for positive change.
- An experienced management team to handle the CSR is very important – a management team who have close knowledge of the difference that community engagement can make to the community and the company.
Research shows us that those companies with strong CSR programs also perform better financially over the long-term and carry less risk than their non-CSR-adopting counterparts. So even in the profits vs environment debate, CSR scores in both. It is good for the company’s balance sheets and good for the community and for maintaining the sustainability of resources for our future generations.
