Legislate CSR in extractives

Communities surrounding mining operations are always complaining that they do not benefit from the exploitation of minerals from their land. Paramount Chief Kyungu and colleagues from Karonga are a fair example.

Communities are always pointing fingers at mining firms as, in most cases, mining companies promise a lot, including infrastructural development like schools, hospitals and other social amenities. We heard things like a water treatment plant among key items Karonga citizens were promised before the opening of Kayelekera Uranium Mine. I am not sure if this was fulfilled.

Generally, when mining operations begin, all the promises fly away. The people see the dream of developing their community crumbling in their faces. The once friendly investors turn to be rude and unfriendly, almost holding natives captives in their land.

The chiefs, who might have brokered the deals based on the sweet talk, feel the betrayal the most as they are looked down upon by their subjects with impudence.

Historically, this is not strange. If we learn about traditional leaders of old like Chief Lobengula, we see how things remain the same even after a century. We can relate to the whole Scramble for Africa through the acts of traditional leaders selling their sovereignty by agreeing to sweet-sounding but unenforceable promises.

Even today, most countries in southern Africa fall victim to this age-old trick devised by mining firms.

Southern Africa Resource Watch (Sarw), in its recent resource barometer, is urging countries to make corporate social responsibility (CSR) a legal mandate. South Africa has already made CSR a law. After over a century of mining, they realised that investors in extractives believe in legally binding agreements not verbal discourses.

According to Edward Lange of Sarw, most mining firms in the Sadc region pay lip service to promises they make prior to signing of the contract since social responsibility is considered as a favour not an obligation.

With South Africa setting the pace, what is remaining is for all countries to make CSR a law in the entire Sadc region. As Malawi is reviewing the 1981 Mines Act, corporate social responsibility has to be made into law. Currently, it falls under regulations. The challenge is that regulations are not enforceable and many chiefs might join the ranks of Kyungu, feeling betrayed, stabbed in the back as there is no legal instrument to make miners account for their promises.

Some mining companies have already started expressing defence, saying they will intensify CSR once they break even and start making profits. It would make business sense to them. But they will never voluntarily agree on CSR and will likely go on lying about making losses.

In other countries, mining companies’ waste time investing in entertainment exercises like football tournaments just as it is popular with a section of some social sectors in the region. Yet surrounding communities are having no hygiene facilities.

To make matters worse, money alleged to have been invested in the sports festivities or trophies is never accounted for to ascertain its veracity.

The result is that plenty of money, which is also sometimes exaggerated, is spent on luxury when communities are failing to access pressing social needs that affect their lives.

It is, therefore, imperative that the new mining laws make CSR a legal mandate for mining firms. In addition, the law should provide opportunities for public audit of all investments towards CSR to ascertain truth in the amounts spent.

Obviously, mining companies might wish to challenge the idea. However, the lip service that the region has been subjected to over a century is enough incentive to framers of the law if they are to give mining communities protection.

This would be one of the features of an ideal model of African mining law. It might appear to be a disincentive to lure potential investors, but what is the importance of having investors benefit at the expense of the indigenous? So, legislate CSR or else keep the minerals on the ground until another serious investor comes!

The author is communication officer for Malawi Economic Justice Network (Mejn).