Commentary
By Ahmed Bangura (Ojulla), UK.
It is understandable that the economic sole aim of a business is to maximise profit. But environmentalists are concerned about how such businesses operate. It is environmentally prudent that businesses must not only limit their operations on profit making but should also be interested in how they interact with stakeholders such as government, communities, etc. Companies, especially those extracting minerals, should not seek their immediate profit objectives at the expense of communities without regard to non-resilient impact in mining communities.
Apparently, mining activities in diamond communities in Sierra Leone have been subjected to negligence and to socially irresponsible investing. Subsequently, the cost of negligence has cost the loss of lives in the recent incident between some residents of Kono and Koidu Holdings Kimberlite mining company.
Sierra Leone, like other developing countries with extraction minerals, is a victim of environmental abuse. Most mining firms operating in Sierra Leone are only interested in maximising profit through any form of mining activity with inadequate environmental concerns and stakeholders approach.
Mining of diamonds is done in all the four provincial regions in Sierra Leone. The mining is done in all forms (small and large scale, and Kimberlite) and at all levels with huge environmental and socio-economic costs.
Despite the policies at national and international levels (Kimberley) the mining industry is yet to be in accordance with the principles of sustainability. From extraction to marketing, ethical values, due to lack of coordinated implementation of mining policies by state institutions are ignored.
Socially Responsible Investing (SRI) encompasses related issues such as human rights, human development, environmental protection (green issue) in the society in which firms operate. Mining Companies should exercise social responsibility towards their stakeholders, towards the natural environment, and towards the general social welfare of workers and the community.
There should be a striking balance of social responsibility and interests, a situation wherein shareholders invest and take responsibility to protect their employees and the environment and interact with other stakeholders to enhance sustainable forms of mining acceptable to all parties.
Therefore, a socially responsible business is one that operates ethically. In most cases governments in developing countries in general and Sierra Leone in particular (at least past regimes) turn a blind eye to responsible investing.
The political bloc acts in an irresponsible manner either because they are desperately in need of investors or are being influenced by rent seeking (corruption). In such an unfortunate scenario, the political elite is often interested in gains from mineral resources than about human rights of workers, community safety, land degradation and sustainable development.
A mining company’s action should be evaluated by probing the pros and cons of its actions on society (Utilitarianism). The mining firm has to be evaluated on the basis of its policies that maximises benefits or minimises cost for its operations in the community. This implies that the social responsibility of a firm is one that produces the greatest net benefits for society or imposes the lowest net costs.
There are basically four stances that a company like Koidu Holdings may choose to take concerning its obligations to the community it operates in.
Firstly, but the least of the four, is the obstructionist stance. In such a situation the firm hardly acts to adequately redress varying stakeholder concerns. The firm crosses the ethical or legal line that separates acceptable from unacceptable practices but deny or avoid accepting responsibility for their actions.
Secondly, the firm can take a defensive stance by which it will do everything that is required of it legally, but nothing beyond that. This type of approach is often adopted by firms that are uncompromising on the concept of social responsibility. Here the company pursues and insists on a defensive shareholder value approach of maximising profit.
Thirdly, the firm may embark on integrative and moderate action (Accommodative stance) in handling social responsible matters. It will meet legal and ethical requirements but will also go beyond these requirements in selected matters. Such firms show interest in matters associated with their operations in communities.
Fourthly, a company can adopt the utmost expectation of a business to attaining an acceptable socially responsible investing acceptable by all parties that want to see a sustainable environment and ethical way of doing business.
Firms that implement this approach take social responsibility in good faith. They are more integrative and work as partners of the common good in the communities they operate. They view themselves as citizens in a society and proactively seek opportunities to contribute to a holistic outcome.
This last stance is what must be required of any company extracting precious stones and even metals in Sierra Leone. Unfortunately, this proactive approach is yet to be seen in the diamond mining industry in Sierra Leone.
Action should be taken now by reviewing mining policies and Acts of parliament, establishing credible mining monitoring institutions (not rent seeking institutions), and the adoption of a bottom-top approach in planning, monitoring and evaluating mining policies and practices.
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