To us, communities aren’t just places. They are the people on whom our operations can have an impact, and with whom we strive to build long-term partnerships: Indigenous peoples, landowners, suppliers, neighbours and our colleagues.
How We Work with Communities
Mining by its very nature requires disturbance to the land and environment and can have impacts on surrounding communities. At the same time mining also delivers significant economic and social benefits to communities, including employment, small business development, tax and royalty streams and education and health programmes.
We try to prevent and minimise impact – social, environmental and health and safety – in part by conducting detailed assessments, in consultation with local communities, and by following robust internal standards and practices that are in line with – and often go beyond – domestic regulations.
Everywhere we work, through all stages of the life of our operations, we respect and support all internationally recognised human rights, in line with the United Nations’ Universal Declaration of Human Rights.
Our teams – everyone from archaeologists and economic development experts to human rights specialists – work in partnership with our communities to understand how our work affects their lives, their culture and their heritage. By doing so, we can respond to community concerns and work to optimise benefits and reduce negative impacts, both for the local community and for the company.
Our communities and social performance (CSP) standard defines the way we engage communities, and outlines the steps we take to identify and manage social, economic, environmental, cultural and human rights impacts throughout the life cycle of our projects, from exploration, to project development, to operation and closure. It also outlines our approach for managing and responding to community concerns and complaints, as well as closing operational sites.
We consult and engage with our communities regularly, in good faith, and in ways that are transparent, inclusive, and culturally appropriate. For example, we often have community information centres in local towns and villages and toll free contact numbers community members can call with questions or complaints. We take local languages into account when developing materials, and regularly present to local councils. We also strive to ensure our engagement is participatory and representative of the community, including women, youth and vulnerable people.
We seek to ensure that our engagement practices respect human rights, that diverse voices are heard and that vulnerable and ‘at risk’ groups can participate in engagement processes. As part of this engagement, we address community concerns, needs and priorities.
In addition, we only award work to contractors who are able to comply with and deliver our Group and site-specific CSP requirements, as well as any local requirements. We also look for ways to increase our leverage to help our business partners respect human rights in line with international standards.
We measure, monitor and review our CSP performance against targets, to help us continue improving. This includes reporting and communicating on how we are addressing human rights impacts, both positive and negative.
Economic and Social Development
We also work to maximise the benefits our company and its work delivers to the communities that host us. Our shared goals are to maximise benefits through social and economic development.
In addition to the taxes and royalties we pay, and the opportunities we provide, in 2020, we contributed to our communities in a variety of ways:
- $165.9 million in payments to landowners, which are non-discretionary compensation payments made by our company under land access, mine development, native title, impact benefit and other legally binding compensation agreements
- $47 million in community investments, which comprise voluntary financial commitments, including in-kind donations of assets and employee time to address identified community needs or social risks
- $12.8 million in development contributions, defined as non-discretionary financial commitments, including in-kind donations of assets and employee time that aim to deliver social, economic and/or environmental benefits for a community, and which we are mandated to make under a legally binding agreement, by a regulatory authority or otherwise by law
In addition, through our local procurement targets, we help create jobs for local residents and new opportunities for local businesses – including the opportunity to supply us with goods and services. In 2020, we spent $15.5 billion with suppliers around the world.
Most of our sites also have a firm local employment target as well as policies in place to promote local procurement. For example, at the Oyu Tolgoi mine in Mongolia, between 2010 and the fourth quarter of 2020, we spent $3.54 billion on national procurement#. And as part of a dedicated national procurement policy – which aims to support a safe and sustainable local supply chain – OT has signed 30 contracts with Mongolia-based businesses since 2017.
We also work to help communities build new skills and new businesses. In Western Australia, home to our iron ore business, we partnered with the government of Western Australia and South Metropolitan TAFE (a technical and further education institution) to develop the Certificate II in Autonomous Workplace Operations programme, the first nationally recognised automation qualification in Australia. This partnership, launched in 2019, aims to train and certify people in new skills that are transferable across industries, so they follow opportunities wherever they arise. In 2020, 28 high school students participated in the programme.
# Oyu Tolgoi's (OT) national procurement figure represents spend with suppliers registered in Mongolia and more than 50% owned by Mongolian citizens. It relates to the OT operations only, and does not include the underground project.
The Importance of Agreements
We were proud to be the first mining company in Australia to embrace native title to land and to form agreements with Traditional Owners. Today, agreements with Indigenous groups, on whose land our operations are often found, as well as others, are central to the way we work and an important way communities drive their own development.
We have many agreements with groups around the world. These community agreements are long-term, often with horizons beyond 50 years, and they help us establish relationships and run our business in a way that delivers mutual value.
Our agreements set the framework for how we engage with communities and Indigenous Peoples, often going beyond legal requirements and forming part of a long-term relationship that often spans decades. This framework also sets the value-sharing model for the financial and non-financial benefits communities receive for access to land, as well as the agreements for cultural heritage management and a range of other important actions.
We work closely with Indigenous and land-connected peoples to understand their physical, spiritual and cultural connection with the local environment. Indeed, our work is predicated upon their active engagement in monitoring and managing cultural heritage. In order to guide our Australian assets, we require them to follow specific mandatory cultural standards.
We consider both tangible and intangible cultural values as part of cultural heritage.
Wherever we can, we design our activities to avoid damage to non-replicable cultural heritage. If it is not possible to avoid an area, we work together on the approach to it, which may include salvage and reclamation, or agreeing a non-disturbance area. In many cases, Indigenous Peoples, on whose land we operate, based on their unique cultural insight, supported by experts, designate which areas can and cannot be accessed.
We also invest in activities that help preserve intangible cultural values that may be affected by our operations. Prior to starting work, all employees and contractors interacting with communities, and in particular, Traditional Owners, are informed about our CSP policies and programmes, as well as the local community context. This includes cultural awareness training for our communities practitioners which, at our operational sites in Australia, is developed and delivered in partnership with local Indigenous groups.
Indigenous Peoples are entitled to all human rights enshrined in the Universal Declaration of Human Rights. In addition, international law recognises their collective rights to their land and its resources, inclusive of special and spiritual relationships they may have with both, warrant particular attention and protection.
We seek to operate in a manner consistent with the UN Declaration on the Rights of Indigenous Peoples, which recognises the right of Indigenous peoples to ‘maintain and strengthen their distinctive spiritual relationship with their traditionally owned or otherwise occupied and used lands, territories, waters and coastal seas and other resources’ (Article 25).
We strive to obtain the free, prior and informed consent of Indigenous peoples (as defined in the IFC Performance Standard 7 on “Indigenous Peoples”) in line with the International Council on Mining and Metals position statement on Indigenous peoples and mining.
We provide easily accessible ways for community members to provide feedback and make complaints, in line with the United Nations Guiding Principles on Business and Human Rights - so we can work on issues together and take remedial actions where needed. Every site is required to have a complaints, disputes and grievances mechanism that operates in line with these criteria.
Guided by Global Standards
Our communities approach aligns with the ICMM Sustainability Framework, the UN Guiding Principles on Business and Human Rights, and the Voluntary Principles on Security and Human Rights. We use the International Finance Corporation's (IFC) Performance Standards on Environmental and Social Sustainability; our CSP standard commits us to compliance with the following IFC Performance Standards:
- IFC PS1: Assessment and Management of Environmental and Social Risks and Impacts
- IFC PS5: Land Acquisition and Involuntary Resettlement
We also support the United Nations Sustainable Development Goals.