Social, Ethical and Environmental Disclosure (SEED) in the Global Mining Industry
Lead Researchers: Heledd Jenkins, Dr Natalia Yakovleva
Background
In recent years the global mining industry has taken up the mantle of corporate social and environmental responsibility; numerous factors have contributed to this, and the extractive industry is key in debates about social and environmental sustainability (Cowell et al., 1999). The finite nature of non-renewables, the diverse environmental impacts associated with their extraction and use, the economic importance of primary extraction industries in some countries, and the social impacts on local communities associated with mining activities have led the mining industry to be amongst the most prolific disclosers of social and environmental information (Tilt & Symes, 1999).
Corporate Social Responsibility (CSR) is a helpful conceptual framework for exploring the corporate attitude of companies towards stakeholders (Wheeler et al., 2002). For the mining industry CSR is about balancing the diverse demands of communities and the imperative to protect the environment, with the ever-present need to make a profit. In doing so they must recognise newly empowered stakeholders (such as indigenous peoples), identify the interests, concerns and objectives of stakeholders and the need to balance or accommodate these different interests (Guerra, 2002). The concept of CSR is a means by which companies can frame their attitudes and strategies towards, and relationships with, stakeholders, be they investors, employees, or communities, within a popular and acceptable concept. The mining industry, like any other, is subject to the pressures of increased stakeholder accountability and social and environmental responsibility; perhaps more so, as they often operate in remote locations with indigenous peoples, and their potential negative social and environmental impact is significant. Social and environmental reporting is a necessary tool in the current social and business climate, as increased pressure on business performance also places a need for mining companies to distinguish themselves in a competitive marketplace (KPMG, 2000).
The dominant research perspective on why companies engage in social and environmental reporting is legitimacy theory. Legitimacy theory relies upon the notion of a social contract between company and society or a community, and on the maintained assumption that companies will adopt strategies, including disclosure strategies, that show society that the organisation is attempting to comply with their expectations (Waddok & Boyle, 1995). Companies are deemed to use disclosure media, such as social and environmental reports, to allay stakeholder concerns, or more particularly what they perceive to be stakeholder concerns (Lindblom, 1994). The report then is a tool by which a company can construct its own ‘social imagery’ (Deegan et al., 2002), the company’s identity, how it perceives the society in which it operates and its relationship with it and how it responds to legitimacy threats.
