country context challenges loom large
DESCRIPTION
Peace Through Commerce Partnerships As a New Paradigm Reflections From Pact Congo and USAID Working With the Mining Sector in the DRC Christian Roy, Pact Congo Robert La Valli è re, Anvil Mining Ltd. Delivered at University of Notre Dame 13 November 2006. Country Context Challenges Loom Large. - PowerPoint PPT PresentationTRANSCRIPT
Peace Through Commerce
Partnerships As a New Paradigm
Reflections From Pact Congo and USAID Working With the Mining Sector in the
DRC
Christian Roy, Pact Congo
Robert La Vallière, Anvil Mining Ltd.
Delivered at University of Notre Dame13 November 2006
Huge country, vast resources, history, image
Governance• Peace process• Election, rule of law, decentralization
Social issues• Limited social development, infrastructure,
livelihoods • Corruption and transparency• Conflict, human rights and security
Business and investment framework
Country ContextChallenges Loom Large
For civil society (Pact)• Community and civil society capacity• Limited social investment and policy• Extent of social development needs• Local, provincial, national, global players
For mining companies (Anvil and others)• Commercial framework
o History, structure of concessions, competitiono Mining codeo Global demand
• Artisan (informal) mining• Security
For donors (USAID)• Limited leverage for good governance
Operational ContextPractical Realities
For Social Development (Pact, civil society, international donors such as USAID)• Mining investment catalyzes socio-economic
development—reduces dependence, increases independence
• Strengthen community capacity and economic opportunity
• Encourage responsible business behavior• Improve transparency, rule of law, royalty
retrocession
For Business (Anvil, other mining companies)• “Social” license to operate—manage “above
ground non-technical risk”• Adhere to international mining code• Address issues that affect operations• Sustain profitable business operations
Engaging With Mining SectorMotivations and Objectives
Good governance• Responsible resource exploitation key to DRC’s
economy and future• Control of DRC minerals linked to conflict• Significant new international investment• Entry points: companies, artisan miners, donors,
communities
Companies face significant risks• Limited capability managing complex social risks• Risk of exacerbating conflict if poorly managed• Pressures against transparency and industry
reform (i.e., entrenched interests)• Unpredictable business environment
Why Engage?Partnership Imperative
Engaging companies and communities• Manage Anvil’s social investment program• Create Trust Fund and help develop foundations with
other firms to support development
Engaging bilateral and multilateral agencies• Global Development Alliance with USAID• DFID support to improve governance• UN support of peace process
Engaging government• Transparency and development issues• Livelihoods
Engaging global standards/practices• Voluntary Principles on Security and Human Rights• Extractive Industries Transparency Initiative• Equator Principles• OECD Guidelines• UN Global Compact
What Are We Doing?Extractive Industries Alliance—Examples
Sustainable development (3 regions, 57 villages)• Community mobilization and governance through
infrastructure• Agricultural livelihoods and productivity• Micro-enterprise and micro-finance with primary focus
on women• Artisan mining
Governance• Mechanism to ensure royalties fund development• Third party assessments• Protocols to follow Voluntary Principles
Capacity Building• Companies: training, recruiting needed expertise,
strengthening procedures• Civil society: community engagement in decisions and
implementation, more options
What Are We Doing?At Ground Level
Reach• Limited reach of improved governance• Scale of intervention vs. scale of sector
Reputation • What is a “responsible” mining company?• Who do we not work with?
Results• Expectations and needs of Congolese• Does business-NGO partnership add value?• No excuses
Security• Security issues loom larger in fragile states• Legacy conflicts, regional context
Spoilers• Not everyone wants to see this succeed
What Is At Stake?“Eyes Wide Open” About Risks
Commitment to practical implementation• OECD• Global Compact• Equator Principles• Voluntary Principles on Security and Human Rights• Extractive Industries Transparency Initiative
“Desk-top” due diligence to assess reputational risk
Field-based due diligence—on the ground
Ongoing performance reviews• Validation of sincerity of purpose• Validation of implementation performance
Due DiligenceAn Ongoing Process
Community improvements• Direct benefits from mining in communities• Expanded livelihoods and SME development
Sustained investments• Mechanism to ensure transparent, collaborative,
sustained community investments• Royalty revenues support public services and
administration (e.g., school, hospitals)
Capability• Pact roles sustained over time in community
organizations, foundations, and business approaches
• Practices influence sector more broadly• Reduced influence of entrenched interests
What Does Success Look Like?Indicators We’re on the Right Path
Resource context• Resources found in difficult places• Global demand growing (incentives to find and
produce)• Gloomy peace prospects if we can’t get this right
Limited government capacity• Civil society and business bring relevant
capabilities and presence to help• No single sector can address range of issues
Significance of business activity• Scale and scope of reach and influence• Skills
Why Does This Matter?Local and Global Implications