Table of Contents
This chapter examines the relationship between corporate social responsibility and social sustainability on the premise that a vital ingredient in social sustainability is the capacity of communities to determine, or at least influence, those decisions that impact them. Communities should be able to influence decisions regarding any trade-offs that may affect them—for example, between economic development and environmental conservation or between meeting the needs of current generations and the capacity of future generations to meet their needs. Local communities[1] in particular, need to determine what is to be sustained, how and at what expense—not only because their lives are impacted by these decisions, but also because local communities are crucial players in processes seeking to enhance sustainability. Corporate actions are clearly relevant in these trade-offs, but if, as seen here, the state proves itself a poor mediator between company behaviour and the desires of local communities, then local communities need to confront companies directly.
It is this interface that is the subject of this chapter—how responsive companies are to the demands of local communities and in what circumstances. It considers what drives miners to respond to the demands of certain communities in order to elucidate when and where communities, in all their complexity, can exert leverage over companies to make corporate behaviours correspond more with the desires of those affected by corporate actions. The case study of mining companies and their relations with Indigenous communities in Australia is used to evaluate whether the tool of ‘civil regulation’ might advance the sovereignty of local communities, so contributing to sustainability and enhancing democracy.
Four examples indicate that corporate responsiveness depends on individuals inside companies perceiving and utilising the ‘business case’ for socially responsible behaviour to pursue corporate change in the direction demanded by particular communities. This ‘business case’, however, depends on communities maintaining vigilance and sustaining a context that impels companies to respond to community demands. Implications for social sustainability arising from this will be set out in the conclusion. Before examining several ‘vignettes’ where civil regulation has been effective theories of corporate social responsibility, democracy and social sustainability, and civil regulation are outlined to frame discussion. Instances of civil regulation and corporate change are the Century mine negotiations and sit-in, Hamersley Iron’s Marandoo dispute, Rio Tinto’s adoption of corporate social responsibility, and the campaign to stop the Jabiluka uranium mine.
Analysis is informed by over 120 semi-structured interviews conducted from 2002 to 2005 with all levels of company personnel and many industry observers, regulators, bureaucrats, stock market participants, environmental and community activists and academics, as well as consideration of corporate publications and other quantitative sources to contextualise personal accounts. This supporting material included annual reports, corporate statements of a company’s vision and operating principles, websites, brochures and other publications, survey questions and results, speeches, media releases, media reports and company statistics.
Democratisation is advanced when political decision-making becomes more inclusive—when citizens become involved in those decisions that affect them (Whitehead 2002).[2] The capacity of communities to determine, or at least influence, those decisions that impact them is a fundamental aspect of sustainability. Advocates of more participatory modes of democracy, however, often complain that contemporary configurations of parliamentary representation are inadequate (see, for example, Barber 1984; de Tocqueville 1945; Dryzek 2000b; Fox and Miller 1995; Hirst 1994; Odd Var Eriksen 2000; Pateman 1970; see also Rayner 1997 for a comprehensive account of the pit-falls of Australia’s representative structure). Formal democratic political processes, invariably parliamentary representation, are accessible to some groups more than others, reinforcing social and economic disparities, and deepening political inequality (Young 2000; see also Dahl 1985; Klausen and Sweeting 2003). Globalisation and corporate power seem to be encroaching on the ability of representative government to uphold citizens’ interests (see, for example, Bang and Bech Dyrbery 2000; Etzioni-Halevy 2003; Korten 2001; Miller 2003). Consequently, government action frequently does not reflect the wishes of particular communities.
With access and influence in formal parliamentary democracy often determined by possession of resources, Indigenous Australians are especially disenfranchised by the contours of representative democracy. A diversity of factors—historical, political, cultural and structural—can potentially explain why many Indigenous communities are disadvantaged in the socioeconomic conditions they experience compared to non-Indigenous Australians (see, for example, Altman 2001b). For example, Indigenous people are more dispersed than other Australians, many live in remote regions with few employment opportunities, while poor education, housing, health and income status reinforces their disadvantage. Consequently, Indigenous Australians are significantly more likely to be impoverished than non-Indigenous Australians—across many indicators.[3]Compared to non-Indigenous Australians, unemployment is 3.2 times higher for Indigenous peoples and Indigenous life expectancy is 17 years lower than that for the total Australian population (Steering Committee for the Review of Commonwealth Service Provision 2005).
Such circumstances illustrate that while Indigenous people are, in theory, able to access representative parliamentary structures on the same basis as non-Indigenous Australians, their standard of living or outcomes from education or health services are substantially below that of non-Indigenous Australians (Robinson and Sidoti 2000; Stokes 2002; Westbury 2003). Despite the complex of reasons for Indigenous disadvantage, imposed ‘solutions’ developed in distant centralised government clearly do not meet the needs of many Indigenous communities.
Furthermore, until relatively recently, Indigenous Australians enjoyed few formal legal and political rights, and struggled to access many mainstream government services. Limitations of parliamentary representation are starkly evident in the Indigenous experience: the small number of Indigenous voters and their geographic dispersal translates to little electoral ‘muscle’. In a democratic system largely dominated by formal parliamentary representative politics, many Indigenous communities have been marginalised to the extent that they are unable to acquire political influence necessary to meet their objectives. In addition, disenchantment with formal structures and processes of representative parliamentary democracy has been deepened by concerted government efforts to facilitate mining, often regardless of the articulated opposition or concerns of local Indigenous communities (seen in the examples below). Such government actions over-ride the wishes of local communities, undermining the influence of Indigenous citizens in decisions that acutely affect them.
In addition, substitution—the risk of citizenship entitlements being deliberately reduced—is faced by some Indigenous communities where mining takes place. Government substituting royalty or other benefits derived from mining in the place of government provision results in a reduction of state finance for community services (Altman, Chapter 2; Levitus, Chapter 4; Altman and Pollack 1998; Banerjee 2001; O’Faircheallaigh 2004a; Rowse 2002).[4] This is made more complex from a democratic perspective: perceptions that existing lack of government service delivery (or threatened reduction) might lead some Indigenous communities to acquiesce to mining if they view mining as the only means to obtain necessary outcomes—health and education services or employment, for example.
The deficiencies of representative democracy thus necessitate supplementary means of delivering democratic ideals such as self-determination and inclusion of those affected in policy-making (Hirst 1994; see also Dryzek 1996b, 2000a; Fliedner 2000; Goghill 2002; Rose 2002). Legitimacy and democracy should not be considered simply as a function of the tenure of elected officers, but should be judged according to how institutions (including non-state entities) address the expectations of those communities they impact. This broad understanding of democracy and governance is further warranted by apparent ability of certain groups to attain desired behaviour from powerful socioeconomic entities—including companies (see, for example, Dryzek 1996a; Eckersley 2000: 118; Maddox 1991; Moon 2003: 2–9; Pateman 1970; Suggett 2000).
If Indigenous communities can, using the tool of civil regulation (see Trebeck 2007a), compel companies to reflect their demands, then the sovereignty, self-determination and sustainability of these communities has been advanced. How this tool is manoeuvred to attain community expectations depends on several factors, pertaining to both the communities and the company in question. The examples below seek to elicit some of these factors to enhance understanding of the connection between corporate social responsibility and social sustainability.
[1] Local communities can be seen as linked by a shared space—thus ‘communities of geography’—other communities might be linked by a mutual concern in an issue—’communities of interest’, or by common experience of being affected by a particular development or entity—hence, ‘communities of fate’ (see Held 2004, who describes the world as comprising ‘overlapping communities of fate’; also Hirst 1994: 49).
[2] The etymological meaning of ‘democracy’ is rule by the people.
[3] Scale of measurement used does not change this fact (Hunter 1999).
[4] For suggestions on how best to avoid this situation see O’Faircheallaigh 2004a.