Corporate social responsibility (CSR) has recently become prominent in the international development agenda. Corporations and current international development discourse promote CSR with claims that local and state governments lack the capability to adequately address social issues and deliver benefits from resource revenues to local communities. Development discourse and its concurrent approaches beginning after the cold war have primarily guided the recent approaches to CSR of extractive industries within the third world. In particular, in the late 1980s and 1990s neoliberal development policies were introduced in many developing countries in Africa to promote foreign investment through structural adjustment programmes, as suggested by development agencies such as the World Bank. But local community benefits from the extractive industries in many areas of Africa have been minimal. This CAI paper explores the emergence of CSR within this context, and explores some of the implications of the shift toward companies conducting development projects normally the responsibility of the nation state. This paper considers whether ‘empowerment’ of community members, particularly in the form of political empowerment, can be meaningfully achieved through CSR by examining two corporate social responsibility projects, in Zambia and the Copperbelt region.

Historical context: The development discourse

After World War II the United States (US) became concerned with the power vacuum that had resulted and how the world would respond, predicting violence and the rise of communist states. The West was also concerned with maintaining levels of control of the peripheral countries, many of which had recently become independent from their former colonisers. It addressed this by spreading its own values of governance and control, such as state self-determination, international cooperation, and free trade, as versed particularly well in US President Truman’s Inaugural speech in 1949.⁽²⁾ For other countries to become like the US they were required to develop, and economic growth was identified as the key necessity to this. In the 1970s this development approach was questioned and challenged, due to countries not achieving the results predicted.⁽³⁾ In the 1980s and 1990s there was an emergence of neoliberal economic development approaches, where private foreign investment was prioritised over public assistance. The development project was thus replaced by the politics of structural adjustment.⁽⁴⁾ The World Bank Group led this transition from classical to neoliberal approaches to economic reform to open up markets, privatise state companies, lower taxes, and implement flexible labour laws to cease the requirement of sourcing labour locally.⁽⁵⁾ This process involved creating an environment conducive to investment in the mining sector. This shift was delivered through international development institutions such as the World Bank. For example, the World Bank released in 1992 a Strategy for African Mining, which encouraged states to adjust laws and regulations, and develop an economic and political environment beneficial for private investors.⁽⁶⁾ As a result, the role of governments shifted to regulators and promoters, and corporations became owners and operators. This process weakened the governance of developing states in Africa, effectively restructuring institutional arrangements, which resulted in a weakened capacity and increased debt and dependence on the West.⁽⁷⁾

CSR as an approach to improve community benefits

The emergence of CSR has been attributed to a widespread acknowledgement that despite private investment and structural adjustment, improved outcomes in developing countries were far from adequate. Neoliberal approaches to development had failed to meet expectations of contributing to social and economic development, particularly of the poor.⁽⁸⁾ Company conduct, particularly in the extractive industry, had also been called into question. Extractive industries have been involved either indirectly or directly in human rights violations in the past, and reports of violations continue today.⁽⁹⁾ CSR has become the solution to mitigating the negative effects of continued neoliberal economic development in developing countries.⁽¹⁰⁾ Within this context emerged a view that corporate actors should take responsibility in areas expanding beyond maximising profits, and providing revenue and employment.

Corporate social responsibility has been defined as “maximizing the positive and minimizing the negative social and environmental impacts … while maintaining profits: in short, contributing to sustainable development.”⁽¹¹⁾ CSR has progressed from an ideology to an on-the-ground reality, with various actors viewing CSR as imperative for defining a corporation’s roles within the community context, and applying ethical and social standards to their operations. CSR can also be viewed as the proliferation of development as an anti-politics machine. Esclava describes CSR as “a suite of institutional and private voluntary social initiatives governing the range of international transactions and corporate negative externalities that are encompassed by joint ventures, licensees and disaggregated supply chains, with their varying degrees of attachment between business partners and involvement of stakeholders.”⁽¹²⁾ He argues that CSR “possesses a powerful capacity for self perpetuation, allowing it to appropriate and rephrase social dissent in its own terms, and cancelling genuine political contestation.”⁽¹³⁾ He demonstrates how CSR contributes to and expands the development discourse, and that it has become a discourse in and of itself. He does this through problematising the adoption of the concept of ‘empowerment’ as CSR’s most valued moral stance. This discussion paper explores CSR’s capacity to support political empowerment, in terms of creating avenues for redress and contestation, and to serve as a platform for meaningful community participation in decision making, by examining two CSR projects from mining companies in Zambia’s Copper Belt.

CSR and the moral stance of ‘empowerment’

CSR practice sits within a particular management framework that holds economic viability at its core, which promotes the expansion of business relations and of the corporation itself.⁽¹⁴⁾ A de-regulated national market often presents the most attractive setting for corporations. CSR as it operates within a privatised and liberalised market, involves predominately self-regulation, and relies on non-endorsable guidelines for practice. While “there is neither a global consensus about content, nor political will to enforce social accountability,”⁽¹⁵⁾ corporations tend to look for guidance from international development organisations, such as the World Bank, the Organisation for Economic Cooperation and Development (OECD) and the United Nations (UN), which promote and encourage CSR. A variety of conceptualisations or approaches are understood and operationalised in the development context and development discourse spouts certain buzzwords for the latest development practice. CSR often claims to improve national and global governance and empower communities through investment in development projects.⁽¹⁶⁾

The type of ‘empowerment’ promoted by corporations is somewhat different to the concept of empowerment discussed by grassroots approaches. The empowerment promoted by corporations can be viewed as part of a strategy to reduce and mitigate risk of conflict from the community.⁽¹⁷⁾ Empowerment is seen as something to be given, to promote a certain type of economic agent that becomes dependent on capital. Local people are not encouraged to become politically empowered, nor are they considered within this framework as right holders. Protestors, concerned employees and communities are all placed within a space with few avenues to voice issues, or effect change.⁽¹⁸⁾ CSR works to gloss over the complexity of issues, such as inexperienced workers, conflict zones, local custom and cultural differences, conflicting laws and influence of management experts.⁽¹⁹⁾

Problematically, companies, through the term empowerment and investment in development, are promoting a particular type of development that means either “progress” or “modernity.”⁽²⁰⁾ CSR therefore reproduces, perpetuates and expands a particular type of dominant development practice (economic-focused) for which it was set up to address the pitfalls of. Instead of problematising past approaches, corporations continue to be rewarded with profits under the guise of social recognition. Corporations now present the claims that were once espoused by strong critics of corporate behaviour and have reinvented them to suit their interests and managerial and technological frames of conduct. CSR has incredible discursive power which constructs the predominate framework for viewing society and corporate relationships, and therefore transforms the relations of power between communities and corporations. Government political power is increasingly shifted toward corporations in this space.⁽²¹⁾

Zambia’s Copperbelt region

Zambia has a long history of mineral dependence, particularly with copper, gold and cobalt. These products comprise four-fifths of Zambia’s exports,⁽²²⁾ and mining accounts for 80% of export earnings and contributes 11% to the country’s gross domestic product,⁽²³⁾ but poverty levels have not improved as a result of the mining wealth in this country.⁽²⁴⁾ The privatisation of the state owned mining company Zambia Consolidated Copper Mines (ZCCM) occurred in the late 1990s. Lungu ⁽²⁵⁾ argues that the deals made by mining companies with the government were uneven, resulting in continued poor revenues to the government, which has limited the capacity for reinvesting in social programmes or community development. The privatisation also led to a reduction in the labour force, and increased mechanisation and redundancies, impacting negatively on the lives of many.⁽²⁶⁾ CSR projects have emerged in the Copperbelt within this context. Two case studies are drawn upon to examine empowerment approaches and implications of CSR in Zambia.

Kansanshi mine in Solwezi

Kansanshi is predominately a copper mine, situated 10 kilometres north of the North Western Province capital, Solwezi.⁽²⁷⁾ A study ⁽²⁸⁾ investigating the impact of Kansanshi’s operations in the area, which included interviews with a wide range of stakeholders, found that Kansanshi had struggled with various community development initiatives, including the development of a clear and cohesive CSR and infrastructure project strategy. In addition, community expectation of CSR projects didn’t match with the company’s actions. Although Kansanshi constructed several water wells and delivered a HIV/AIDS project, a measles campaign, an anti-cholera water purification programme and a malaria prevention programme, community members commented during interviews that investment would be better spent in upgrading local clinics. For example, the only health facility in Kyafukuma community is poorly staffed. The closest clinic to the community New Israel is located a five hour walk away.

Kansanshi conducted several education projects, funding the construction of classroom blocks in Kabwela and Mushitala, the refurbishment and equipping of laboratories, the construction of a girl’s dormitory, and upgrades to the Solwezi training centre. The community generally responded well to the education projects however concerns were raised regarding unfulfilled promises. For example, in Kabwela, construction of a second classroom block and staff houses had not commenced, leaving one teacher for 412 students; and the teacher lived 15km away from the school. In New Israel, the community commented that overall there was a lack of proper education facilities; the mine had merely supplied iron sheets to construct school sites. Community members had relocated to the area for the purpose of employment in the mine, and expected that services would be built to accommodate them. The community members in general stated that Kansanshi should engage in projects such as building houses, roads, schools and clinics. Many community members also recommended that the company complete or commence the projects promised. The company set up a foundation in 2006 to direct funds toward infrastructure projects as remedial action. However, serious operational issues emerged over time. For example, in 2008 during the economic crisis, the foundation ceased to operate. Funds were mismanaged and embezzled. The individuals on the Kansanshi Mining Plc board were also assigned to the foundation’s board, excluding the local stakeholders such as chiefs, government and community representatives from meaningful decision-making.

Overall, the community expressed that the company engaged with them poorly. The community reported an overall dissatisfaction with stakeholder meetings delivered by Kansanshi, viewing the meetings as a “one-sided form of interaction.”⁽²⁹⁾ Consistent with other research, the study also highlighted that there are limited avenues for community members to communicate grievances and to hold companies and governments to account for promises made. The community was not involved adequately in decision-making processes from the beginning and throughout the project. Involvement in the decision-making process is important, particularly for political empowerment. Best practice guidelines and standards, such as capacity building to ensure community driven engagement occurred effectively, like, for example, participatory monitoring and evaluation processes, were not adhered to. Aspects thereof were merely adjusted to suit the priorities of industry rather than those of the local communities. Therefore members were not given the space to engage in political empowerment.

Konkola Copper Mines in the Copperbelt

United Kingdom-based Konkola Copper Mines (KCM) commenced a CSR programme in the Copperbelt region of Zambia, funded predominately by the World Bank and other donors.⁽³⁰⁾ The company developed social and environmental plans utilising a sustainable livelihood approach, focusing on a multi-stakeholder approach to define their strategy for working with the Copperbelt local communities.⁽³¹⁾ The strategy was widely praised by the industry, however Hamann and Kapelus argue that the company failed to introduce “accountability and fairness into the development process.”⁽³²⁾ Economic incentives were found to drive the agenda. A large-scale resettlement project was undertaken. However, in 2002 the companies Anglo American and the International Finance Corporation (IFC) withdrew from KCM due to the declining copper price, which created significant social disruption and uncertainty around whether the mine would go ahead, with the long-term social costs unaccounted for.⁽³³⁾ This example demonstrates how CSR policies and practices can be placed on hold due to financial business decisions based on profits. Accountability and redress are significantly important in these situations.

Conclusion

CSR has become a driving force for development now well embedded within the current international development discourse with many companies operating in the third world taking this approach to their development projects. The emergence of CSR has been driven for various reasons, including the poor outcomes for local communities in comparison to the large profits extracted from the mining industry in particular.

This discussion took a critical view of CSR, drawing from two case examples from Zambia’s Copperbelt region. Companies’ ability to grant empowerment, particularly political empowerment, to local people is a concept which is often part of the CSR rhetoric. However, CSR runs the risk of continuing to expand and drive a particular discourse of development with economic growth as its core value, despite espousing social responsibility aims using best practice development terms such as empowerment. CSR reinvents company practice as ‘anti-political’, and due to its own self regulation and its voluntary nature, it is unlikely to provide an adequate space for political empowerment in the form of local contestation, meaningful political engagement in decision making or avenues for seeking redress for company conduct.

Written by Claire Burgess ⁽¹⁾

NOTES:

(1) Claire Burgess is a Research Associate with CAI with a particular interest in human rights law. Contact Claire through CAI’s Africa Watch Unit ( africawatch@consultancyafrica.com). Edited by Nicky Berg.
(2) Rist, G ., 1997. The history of development. Zed Books: London.
(3) Ibid.
(4) Ibid.
(5) Szablowski, D., 2007. Transnational law and local struggles: mining communities and the World Bank. Hart Pub Limited: Oxford.
(6) ‘Strategy for African Mining’, World Bank technical paper number 181, August 1992, http://www-wds.worldbank.org.
(7) Cambell, B., 2012. Corporate social responsibility and development in Africa: Redefining the roles and responsibilities of public and private actors in the mining sector. Resources Policy, 37(2) pp. 138-143.
(8) Hamann, R., 2003. Mining companies’ role in sustainable development: The ‘why’ and ‘how’ of corporate social responsibility from a business perspective. Development Southern Africa, 20(2), pp. 237-254.
(9) Business and Human Rights Resource Centre website, http://www.business-humanrights.org.
(10) Rist, G., 1997. The history of development. Zed Books: London.
(11) Hamann, R., 2003. Mining companies’ role in sustainable development: The ‘why’ and ‘how’ of corporate social responsibility from a business perspective. Development Southern Africa, 20(2), pp.
237-254.
(12) Esclava, L., 2008. Corporate social responsibility and development: A knot of disempowerment. Sortuz. Onati Journal of Emergent Socio-legal Studies, 2(2), pp. 43-71.
(13) Ibid.
(14) Ibid.
(15) Ibid.
(16) Ibid.
(17) Ibid.
(18) Ibid.
(19) Ibid
(20) Escobar, A., 1995. Encountering development: The making and unmaking of the third world. Princeton University Press: Princeton, N.J.
(21) Litvin, D., Empires of profit – commerce conquest and corporate responsibility. Texere: New York.
(22) Alstine, J.V. and Afionis, S., 2013. Community and company capacity: The challenge of resource-led development in Zambia’s ‘New Copperbelt’. Community Development Journal, 48(3), pp. 360-376.
(23) Namutowe, J., ‘Mining sector, pivot for economic development’, The Times of Zambia, 12 November 2013, http://allafrica.com.
(24) Lungu, J., 2008. Copper mining agreements in Zambia: Renegotiation or law reform? Review of African Political Economy, 35(117), pp. 403-415.
(25) Ibid.
(26) Ibid.
(27) Alstine, J.V. and Afionis, S., 2013. Community and company capacity: The challenge of resource-led development in Zambia’s ‘New Copperbelt’. Community Development Journal, 48(3), pp.360-376.
(28) Ibid.
(29) Ibid.
(30) Hamann, R. and Kapelus, P., 2004, ‘Corporate social responsibility in mining Southern Africa: Fair accountability or just greenwash?’ Development, 47(3), pp. 85-92.
(31) Ibid.
(32) Ibid.
(33) Ibid.