Better framework, legislation needed for sustainable CSR initiatives

Corporate social responsibility (CSR), especially in the absence of a thorough appreciation of systemic weaknesses and local idiosyncracies, is often not very successful, says University of the Witwatersrand Centre for Sustainability in Mining and Industry directorCaroline Digby.

Speaking at a CSR workshop hosted by The High Commission of Canada and consulting firm Eunomix, on Wednesday, she stressed the importance of CSR becoming part of companies' core business.

She added that the definition of CSR included ad-hoc charitable donations and good cause support; however, it also included more rigid descriptions of obligations companies had to contribute to society and the environment.

“The terms and definitions are confusing because they are mixed with many other concepts that we throw around. [Terms] like ‘good citizenship, ‘corporate social investment’ and ‘corporate accountability’ all describe various aspects of what we are trying to get at with CSR,” Digby said.

She believes CSR expectations are too high in countries with weak governments.

“This is because CSR is basically a western concept, where there are strong labour unions and vocal consumers. One could argue that these conditions could generate invisible pressures that drive companies to adopt CSR practices,” Digby said.

She explained that in countries with poor regulatory enforcement and a lack of transparency around contracts agreed upon with governments, it was more difficult to understand the incentives for companies to police themselves.

“There are some studies that paint a very rosy picture of the programmes formulated by big multinationals in their head offices in [developed market economies] and how these standards are actually adopted in less developed countries.”

Digby pointed out that many communities argue that CSR is merely used as a public relations tool to improve a company’s reputation and image.

“We all see reports suggesting that CSR initiatives are making a difference in communities where big corporations operate. I think we have to understand that CSR is a corporate concept . . . and that community groups don’t see [CSR] in the same perspective as large corporations.”

Digby clarified that some people in South Africa considered CSR as restorative justice to address the legacy of apartheid.

“I don’t agree that CSR has that capability, but it certainly [tries to focus on] transformation and restorative justice,” she said, adding that CSR policies generally target health andeducation, “but success has been limited”.

Digby drove the point home by pointing to the lack of coordination between companies, regional arms of government departments and municipalities. Alignment with regional integrated development plans was nonexistent and at the mercy, moreover, of very weak monitoring and evaluation, which focuses on "inputs instead of outputs".

“In South Africa, one would think [intuitively] that we don’t really have to worry so much about CSR, because we have comprehensive legislation specifically designed to contribute to sustainable development and to work with communities [where mining is active].”

But, explained Digby, this was not the case.

She said that the Mineral and Petroleum ResourcesDevelopment Act was there to transform mining is South Africa, noting that it required the submission of a social and labour plan (SLP), as a prerequisite for securing miningrights.

The objective of the SLP regime is to promote economic growth, employment, social welfare and the socioeconomic development of areas where mines operate, “as well to utilise and expand the skills base for the empowerment of previously disadvantaged people", she outlined.

“The SLP framework on paper provides us with a vehicle to exercise CSR. Unfortunately, we don’t have the framework working well on the ground yet,” she concluded.

Canadian High Commissioner to South Africa Sandra McCardell, meanwhile, told delegates at the workshop thatCanada’s CSR strategy was aimed at having all Canadian companies operating abroad to respect human rights and all applicable laws.

“Our strategy is robust, focusing on partnerships throughout our 160 trade offices abroad, facilitating dialogue through two dialogue resolution mechanisms and strengthening theenvironment in which our companies operate,” she said.

McCardell, for her part, pointed out that if Canadian companies did not meet the outlined expectations or follow the best CSR practices and did not want to participate in the two dialogue participation processes, “we stop advocating on behalf of these companies”.

-Mining Weekly