Sustainable Community Development and Closure
Resource companies contribute to the community in many ways, through employment, use of local suppliers and contractors, disbursements to governments, including taxes and royalties, and by providing support, both financial and non-financial, for community development programs and local community organisations.
Although the lifespans of our operations vary, all reach a point where the majority of the natural resource has been extracted and it is no longer economic to run them. The social and environmental impacts of closing an operation are complex, especially when it has been a major contributor to a local economy or when a community has essentially been built around the operation.
Our challenge is to maximise the benefits to communities so that we leave a lasting positive legacy.
The resources industry has had a chequered history in relation to creating a sustainable positive legacy. It has tended to take a paternalistic approach with limited community consultation and has been inclined towards technical solutions such as the building of infrastructure (schools and hospitals) without focusing on the need to engage communities in the process or to train and develop local people to manage these facilities.
We recognise a need to more actively involve communities in our development programs if the programs are to achieve truly sustainable long-term outcomes, and to do this effectively we must increase the relevant skills and expertise of people within the Company. It is only by building human and social capacities within the community that we will leave a valuable legacy that outlasts the operation itself and ensures a positive future for communities beyond resource extraction.
Refer to the following sections on:
- details on Our approach to this challenge
- an understanding of Our drivers
- An external view on the challenge from a member of our Forum on Corporate Responsibility.
Our approach
Communities
Our businesses all operate programs to create medium to long-term benefits for the communities in which they operate. In 2002, the Company introduced a target to spend 1 per cent of pre-tax profits (on a rolling three-year average) on community programs. In each year since then, this target has been met.
Company-wide guidelines provide a set of principles that facilitate a consistent approach to community development and support for community activities. Principles include valuing the knowledge and opinion that resides within communities and working with them to develop meaningful programs; investing in programs where our contribution can be leveraged through support from other bodies; and building local capacities so that community members are empowered to take control of their own development processes. Within this framework, each business operates its own community programs to ensure we respond to local needs and concerns.
To improve understanding of community development methodologies within the Company, more than 40 of our community relations professionals have participated in the Oxfam Community Aid Abroad Corporate Community Leadership Program over the past three years. The program provides an opportunity for our employees to participate in a study tour in India where they see first-hand the challenges of community development through the eyes of local communities and the NGOs that work with them.
Employees
There has been much discussion within the resources sector as to whether it is better to establish a community around a minesite or to create a fly-in, fly-out operation. There are advantages and disadvantages in both approaches. Establishing a town or community offers employees and their families stability for the life of the mine, but the disruption on closure is substantial. Fly-in, fly-out operations mean that the impact on families is reduced on mine closure but that employees are away from their families for extended periods of time during operation.
Across our operations there are examples of both situations. Our approach is to continue to look for the best solution for employees and the business and to train and develop our people to ensure they are well equipped, on closure of an operation, to apply for other jobs either within or outside the Company.
Environment
The very nature of our business is such that some level of environmental disturbance is inevitable in the short term. In line with our commitment to Zero Harm, we set targets to progressively reduce our impact on the natural environment during the operations phase. We also require all our operations to develop detailed closure plans that address both the environmental and social aspects of closure. Stakeholder engagement, particularly with regulators and local communities, is a critical dimension to this process. A very important aspect of the planning process is the development of a post-mining plan. Mining practices can then be developed with the final land use in mind, in line with our Closure Standard. The plans must also be fully costed and appropriate provisions incorporated in the Company accounts.
Our drivers
In the BHP Billiton Charter, one of the indicators of success is that the communities in which we operate value our presence. Sustainable community development will ensure communities continue to benefit after mine closure.
A stable, healthy and supportive society enables businesses to operate effectively. By contributing to the social fabric of the communities where we operate, we are also creating an environment in which the Company can grow.
With many new projects located in developing countries, it is increasingly important for us to be able to demonstrate to key stakeholders, including governments, that we have a good track record in making a sustainable contribution to the environment and community, in addition to providing economic benefits.
An increasingly important aspect for consideration by prospective employees is the social responsibility credentials of a company. In order to attract and retain the best employees, we need to be able to engage employees in our community efforts and provide opportunities for them to be proud of their Company.
An external view
‘BHP Billiton understands that the intrinsic characteristics of an extractive industry cause a regional development boom wherever it operates. This boom can have a negative or positive impact, depending on how it is managed.
‘There is a great opportunity to channel this boom activity towards sustainably developing the region in the area of influence of the project, almost like the jiujitsu theory, channelling the energy of a given challenge in favour of the region’s community and environment and, ultimately, of the company and the project itself. This will assure the sustainability of the region when the company leaves at the end of the project.’
Dr Marcelo de Andrade, Chairman, Pró-Natura
Refer to the section on Our approach to understand how we address some of these concerns.
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