a model for stakeholder engagement in mineral exploration...

232 6th International Conference on Sustainable Development in theMinerals Industry, 30 June – 3 July 2013, Milos island, Greece

A model for stakeholder engagement in mineral exploration in Finland

T. EerolaGeological Survey of Finland, Finland

ABSTRACTThe growing interest on the Fennoscandianmineral potential has resulted in a mining boomin Finland. A number of foreign companies areoperating in Northern and Eastern Finland. Thishas caused opposition, firstly regarding the ura-nium exploration, but now concerning also othercommodities, and even geological field work.

The stakeholder engagement is one of themain components of corporate social responsi-bility. Contacting and informing the local com-munities about mineral exploration at the verybeginning of activities has helped companies toestablish a good relationship with them, earningthe local social license to operate. This paperdescribes a method of stakeholder engagementthat has been used by the author in mineral ex-ploration in Finland.

The main groups forming the local communi-ties that should be taken in account in stake-holder engagement in Finland are the residents,landowners, mineral collectors, municipal ad-ministration, council, media, NGOs, entrepre-neurs, as well as reindeer herders and SámiPeople at Lapland. All of these should be con-tacted at an early stage of exploration, prefera-bly already at the reconnaissance stage, but atleast at the moment of claim application, whichis the most critical moment. If the local commu-nity is not informed previously about the inten-tions and activity by the company and the claimapplication is communicated by authorities ormedia, it can cause fear and anxiety. This canculminate in opposition. The different ap-proaches applied to contact and inform thosecommunity groups are described in the paper.The method is suggested also to be used in geo-

logical field work, respecting the local people,and avoiding possible conflicts when workingon private lands.

1. INTRODUCTIONThe stakeholder engagement is one of the maincomponents of corporate social responsibility(CSR). Regarding the mining industry, it hasbeen mainly studied concerning mines(Kapelus, 2002; Handelsman et al., 2003; Jen-kins, 2004; Kemp et al., 2006; Kemp, 2010; Es-teves and Barclay, 2011). However, mineral ex-ploration has crucial importance in the mininglife-cycle. It is the very first time when a com-pany has contact with a local community, start-ing the construction of interaction and relation-ship between them. Therefore contacting and in-forming the local communities about mineralexploration at the very beginning of activitieshas helped many companies to establish a goodrelationship with them, earning the local sociallicense to operate (SLO, Moon and Whateley,2006). Despite that, the studies on stakeholderengagement in mineral exploration are few andmainly concentrated on developing countries(Common Ground Consultants Inc., 2007;Hohn, 2009; Luning, 2012). Most of the modelsand reporting systems for this activity were cre-ated for those conditions and/or having indige-nous people in mind. Therefore these are notnecessary appropriate when dealing with peopleof a developed country with a good educationallevel, public services, well-being, infrastructure,and respect for human rights and justice, like inFinland. In this sense, the stakeholder engage-ment emerges as the most important issue ofCSR in developed countries, and the methods

6th International Conference on Sustainable Development in the 233Minerals Industry, 30 June – 3 July 2013, Milos island, Greece

and models should be adapted to local condi-tions.

This paper describes a model for stakeholderengagement that has been developed and usedby the author in mineral exploration in Finland(Eerola, 2008, 2009). The local stakeholdergroups are identified and the application of dif-ferent approaches described when contactingand informing them.

2. MINING AND ITS OPPOSITION IN FIN-LANDFor a long time, the mining industry in Finlandwas entirely national, operated mainly by state-owned companies. Mining had large acceptance,as it was seen as an important part of a nationaleffort to industrialize the country. During the1990's, the state retrieved from mineral explora-tion and most of the mining. At the same time,Finland entered in the EU, what allowed foreigncompanies to explore diamonds and gold in thecountry. The challenges with lack of infor-mation on mining and geology among the gen-eral public and potentiality of resistance againstforeign mining companies were already predict-ed at that time by Eerola (1996).

With the rise of metal market prices at thebeginning of this millennium, increasing num-ber of foreign companies started to invest inmining and exploration of several commoditiesin Finland, including uranium. Uranium explo-ration generated the first notable wave of oppo-sition for mining activities in Finland during2006 and 2008 (Eerola, 2008; Karasti, 2008;Litmanen, 2008; Sarpo, 2008), although the re-sistance has been greatly overestimated (Jarttiand Litmanen, 2011). The debate on uraniumceased rapidly, but with the frequent environ-mental problems and the plan to produce urani-um as a sub-product from Talvivaara, the big-gest nickel mine in Europe, opposition for min-ing in general spread over the country, especial-ly against foreign mining companies (Jarttiet al., 2012). Actually there is now criticism to-wards all geological research. Therefore the in-dustry, research community and the authoritiestry to look what to do with the situation.

3. CSR STUDIES ON MINING IN FINLANDAs the mining boom is very recent in Finland,there is little literature concerning its CSR. Theuranium exploration has been the main subjectof academic investigation (Eerola, 2008, 2009;Karasti, 2008; Litmanen, 2008; Sarpo, 2008;Jartti and Litmanen, 2011), but more recently,mines of other commodities have attracted at-tention (Sairinen, 2011; Jartti et al., 2012; Mo-nonen, 2012; Rytteri, 2012), reflecting the inter-national trend. Excepting the uranium, there areno papers dealing with the mineral exploration.As the subject is mostly studied by sociologists,they seems to not have perceived the importanceof mineral exploration in CSR and company-community relations. The greater interest of so-cial scientists on mines might be explained bytheir major environmental and social impacts.

The Finnish government considers mining asan important economic activity, especially inremote areas of Eastern and Northern Finland.Because of the problems that the industry isconfronting with the public opinion, and themedia, the Ministry of Employment and theEconomy has recently launched a series of initi-atives to guide the industry in order to obtain theSLO. The Mining Academy is one of them. It isa three year project lead by the Geological Sur-vey of Finland, which looks for the best practic-es since mineral exploration to mine closing andafter care, according with the CSR principles.The model presented here within for the stake-holder engagement in mineral exploration isrecommended by it in Finland.

4. A MODEL FOR STAKEHOLDER EN-GAGEMENT IN FINLANDEerola (2008, 2009) developed and applied amodel for a local level stakeholder engagementin uranium exploration. However, here it isadapted for exploration of other commodities.The model takes in account diverse communitygroups, with tailored approaches to interact withthem. The central issue of the model is commu-nication and the establishment of first contactswith communities.


4.1. Mineral exploration and the Mining ActThe proposed model is a process-like approach,following the steps guided by the Finnish Min-ing Act for mineral exploration.

Based on the Nordic specialty, the so calledevery man’s law, people are allowed to move inprivate lands to collect fruits, mushrooms, min-erals and rocks. This permits also reconnais-sance and preliminary geological investigations,such as mapping, geophysical surveys and lightsampling for anyone without any official permit.

According to the Mining Act, the companycan apply for claim reservation in order to guar-antee the privilege to apply for a claim. Howev-er, the claim reservation does not permit full ex-ploration with drilling and trenching. This is al-lowed by a claim.

The licensing for mineral exploration andmining is carried out by the Finnish Safety andChemicals Agency, which also informs thelandowners about the applications for those.However, landowners can also give permits fordrilling and trenching in their own lands.

4.2. TimingThe contacts with local communities should bemade at an early stage of exploration, preferablyalready at the reconnaissance stage, as also rec-ommended by Moon and Whateley, (2006), andCommon Ground Consultants (2007), but atleast when applying for a claim, which is themost critical moment (Eerola, 2009). This is dueto the fact that if the local people are not in-formed previously about the intentions and ac-tivity of the company in the region by itself, andthey become aware of the claim application byother means (media, authorities) as a surprise, itcan cause fear, anxiety and irritation (Eerola,2008, 2009). This, for instance, may culminatein opposition and possible conflict. In order toavoid that, the company must be proactive incontacting the local community first.

4.3. Identification of local community groupsThe concept of community and definition of itsconstituents by mining companies has been asubject of debate, especially regarding develop-ing countries (e.g. Kapelus, 2002; Jenkins,2004; Kemp et al., 2006; Luning, 2012). Differ-

ent approaches (e.g. anthropological studies)have been suggested in order to define whichstakeholders compose the local communities(Jenkins, 2004; Luning, 2012). However, thesituation is much more simply in Finland than inremote areas of developing countries. Based onthe author's experience, the key groups of thelocal communities that should be taken in ac-count in Finland are the residents, landowners,municipality administration and council, media,NGOs, entrepreneurs (Eerola, 2009), and min-eral collectors, as well as the reindeer herdersand Sámi people at Lapland. Although manytimes the groups overlap and interact dynami-cally, the two last groups deserve some specialconsiderations, given in later sections.

4.4. Approaches with local stakeholder groupsThe contacts and communication are suggestedto be made in Finnish, and personally by a geol-ogist operating in the area. The exclusive use ofpress releases and/or communication profes-sionals should be avoided (Eerola, 2009). Con-tact information is given, permitting the two-way communication, and expression of ques-tions and possible worries for the company.

The groups composing communities in Fin-land are briefly characterized and their tailoredapproaches are given below.

4.4.1. Inhabitants and landownersThe inhabitants and landowners within or at vi-cinities of the target area form the most im-portant group. Many times the local residentsare also landowners. They are frequently thevery first people met already at the beginning ofthe field work. However, instead to be met bychance in the field, they are suggested to be vis-ited at their houses. In the visit, a geologistshould introduce himself, the company and itsactivities and intentions on the area. It is alsogood to tell about the geology and mineral po-tential of the region. Landowners and residentscan be asked to show the previous mineral ex-ploration sites in the field.

Landowners can permit drilling and trench-ing in their own lands, and services can be con-tracted for mineral exploration works. Systemat-


ic, heavy sampling requires them to be commu-nicated by written on that.

4.4.2. Mineral collectorsCollection of rocks and minerals is a commonhobby in Finland, with several associations ded-icated to this activity. Many laymen search andcollect ore minerals found in glacial bouldersand outcrops, and send samples to be evaluatedby the Geological Survey of Finland (GTK).Several ore deposits have been found by thisway by the GTK. Contacting the enthusiasts onrocks and minerals can be valuable support formineral explorers, as potentially helpful infor-mation for geologists. The company can actual-ly stimulate this activity by rewarding the col-lectors of best samples.

4.4.3. Reindeer herdersThe reindeer herding is a traditional livelihoodin Northern Finland. The herders are recom-mended to be contacted through their Associa-tion, but it can be done also at their home and/orin the field. The reindeer grazing might imposesome special conditions that should be taken inaccount in mineral exploration and discussedwith them. Those are the period more appropri-ate for mineral exploration and protection andsigning of trenches without disturbing the rein-deer herds. The Reindeer Herding Associationpublished recently a guide for land use andreindeer herding, taking also in account mineralexploration and mining (Paliskuntain yhdistys,2013). Services and work force are recommend-ed to be contracted for mineral exploration.

4.4.4. Municipal administration and councilThe Municipal administration and council areimportant to be contacted. However, thoseshould not be considered as the main representa-tive of a community, which is a common mis-take of mining companies (Kapelus, 2002; Jen-kins, 2004; Common Ground Consultants, 2007;Hohn, 2009); the permits and approval given byauthorities are not any guarantee for a local ac-ceptance of a project.

It is recommended to arrange a meeting anddiscussion with the mayor and the administra-tive board, and to give a lecture for them, the

council and general public on the company, itsactivities, and intentions, as well as on the geol-ogy and mineral potential of the region.

4.4.5. Local mediaGenerally, the local media is represented by alocal journal. It is recommended to be proactivein approaching the media, visiting the press of-fice, meeting the Chief Editor, and telling himabout the company and its activities. A journal-ist can be invited to do the interview in the field,showing him the area and what is done there. Agood coverage in the local media helps thecompany and geologist to be known in the re-gion. A press conference for other, national andprovince level medias can also be arranged.

4.4.6. NGOsThe local NGOs may comprise environmental,forestry, hunting, fishing, and village associa-tions. Those should be assessed and contacted.It is good to have meetings with them, and givelectures on the company, its activities and inten-tions and region’s geology and mineral poten-tial. They can also be invited for a trip to thefield to show the activities.

4.4.7. EntrepreneursThe local entrepreneurs can be a powerful andinfluential group. Regarding the mineral explo-ration, the most important of them are the tour-ism, forestry and service provider entrepreneurs.It is recommended to visit them and contractservices for mineral exploration, investing onthe place. This way the local community partic-ipates and receives benefits from the mineralexploration. In turn, mineral explorers benefit ofthe local expertise.

The tourism entrepreneurs can be worriedabout mineral exploration, because of the socialand environmental impacts of mines, whichmight affect their business. Clear plans on min-eral exploration should be shown and a mutualunderstanding on the benefits and solutions foreventual problems that mineral exploration anda possible mine can bring to the region shouldbe attempted.


4.4.8. The Sámi peopleAlthough Sámi people are an indigenous group,they are quite well integrated with the Finnishsociety. Therefore contacting and dealing withthem does not require any special approach, butusually it can be made in the same way as isdone with landowners and local residents else-where in Finland. However, very recently, insome cases they have required written commu-nications in the Sámi language, and the SámiParliament has started to systematically opposeany geological activities in Lapland, refusing adialogue. This seems to be related with the dis-cussion on the ratification of the ILO’s Agree-ment 169 on the Indigenous People’s Rights byFinland.

5. DISCUSSIONThe company’s absolute and unconditional sup-port for stakeholder engagement is crucial for itssuccess (Eerola, 2009; Kemp, 2010). In thissense, there might be internal problems in itsapplication, that are reflections of the past andculture in a new, current situation in Finland:For centuries, every man’s law has allowed an-yone, including geologists, to move on privatelands with no need for explanations or permis-sions. As geologists are used to do so, this cancreate problems. The Finnish culture is also notvery communicative, and shy geologists canprefer to avoid contact with the locals "hiddenin the bush", instead of being proactive in look-ing for it. This may give a secretive impression,raising doubt and mistrust. There is also the oldgeneration of Finnish managers who worked asfield geologist at the time when mining waslargely accepted, and they might have difficultyto adapt the companies’ strategy for the currentreality that requires totally new approach withthe local stakeholders.

6. CONCLUSIONSA model for stakeholder engagement in mineralexploration in Finland was presented. It takesinto account diverse constituents of local com-munities. The approaches in contacting themwere differentiated. The purpose of the de-

scribed approaches is to have a contact with thelocal community in a wide scale, “showing theface” of the company, establishing a dialogue,and to obtain a good image and relationshipwith the locals since the beginning of mineralexploration in the region. It is important to tellabout the realities of mineral exploration, and toavoid to raise up fears and false expectations onthe future of the project. Lectures are the mostcommon approach applied for wider audiences,but people also appreciate personal contacts,honesty and openness demonstrated by geolo-gist and his company, creating trust that is es-sential in obtaining the SLO. Actually, a geolo-gist is the "visiting-card" of the company, inwhich the social ability and communicationskills are important.

Maintaining a good relationship, staying pre-sent at the region and open for feedback fromthe locals during the whole duration of the pro-ject, and participating actively in the communityare important. In the best case, if properly con-ducted, a company obtains the local acceptancefor its activities by local stakeholder engage-ment since the very beginning of its activities ata region. After that, it is easier to construct apartnership with the local community in the caseof a possible mine.

Due to a recent critical attitude even towardsgeological field work, the model can be also ap-plied on it, by being polite, respecting the localpeople, and avoiding possible conflicts whenworking on private lands. The stakeholder en-gagement is also an excellent opportunity to talkabout geology for the general public.

ACKNOWLEDGEMENTSThis is a contribution for the Mining Academylead by the GTK. Thanks to the GTK’s Re-search Director, Dr. P. Nurmi and Regional Di-rector of Southern Finland Office, Dr. K. Ne-nonen for permission to publish the article andcomments that improved the manuscript. Dis-cussions with student S. Ziessler and geologistM. Tuusjärvi and their comments were alsofruitful.

Namura Finland Oy and Stonerol Oy sup-ported the author to develop and experiment themethod in practice.


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