Lessons for sustainable mining loom in Peru

COMMENTARY

Doe Run’s Cobriza copper mine in southern Peru is located in one of the poorest areas in one of the poorer countries in South America. Like all mines, Cobriza has a finite life, and the question of the area’s post-mine future has serious implications for the indigenous population.

However, the Cobriza story is not like other mines. The work at Cobriza provides an example of how mining companies are interacting and working with local populations in Latin America and around the world. While mining is by its nature temporary — it continues only as long as there is ore that can be extracted profitably — the companies involved wield great influence, which they can use to provide long-term benefits.

Why worry about beneficial legacies? Companies across all sectors, not just mining, see such legacies as not only their financial responsibility, but as the right thing to do.

At Cobriza, for instance, Doe Run teamed with Golder Associates to improve the quality of life of 22 local communities.

Doe Run embraces sustainable development because it meets the company’s values and is part of its overall philosophy. The approach has resulted in good local relationships that give the company credibility with regional leaders — both within the formal political structure and with informal leadership that often wields even greater influence.

The locals know that Doe Run will deliver on its promises. This has helped build support and these relationships cannot be undervalued in a business climate where local populations are increasingly saying no to mining.

Doe Run’s “good-neighbour” involvement dates back to 1997, when the company purchased the smelter at Cobriza, and the mine itself, a year later. Things got off to a good start when existing staff was hired locally. To this day, there is only a handful of North Americans in management.

Since 1997, Doe Run has launched a number of community-development projects; some target youth through school construction and education programs, while others target mothers through access to social workers to help build better parenting skills and income-earning possibilities.

One of the latest and arguably most successful endeavours has been the development of more income-generating opportunities, such as weaving. The skill has long been a part of local culture, but most products were made for personal use or local markets. Doe Run provided looms and space for weaving, as well as some business advice. Some of the woven materials are now sold to the broader market, including export markets.

As engineering consultants to Doe Run, Golder Associates made many visits to the site and was familiar with the local economy. Golder has branded corporate apparel and other products that are used as promotional items. Someone hatched the idea of having Cobriza-area artisans produce unique, hand-woven articles that could be used in Golder promotional items.

Golder ordered several hundred hand-woven blankets, with customized corporate logos. The purchase was a boost to the weaving enterprise and allowed the Peruvians to see a possible future involving more woven exports.

What can the mining sector learn from this? Being a “good neighbour” can, if a company is not careful, turn into a runaway train. Many more requests for help are received than can be met, particularly in a country without a well-funded central government or infrastructure. In terms of providing for the social needs of the local population, mining companies could quickly fulfill many of the roles that a government would be responsible for in more wealthy countries.

Doe Run has avoided taking this role, in part by removing itself from the implication that it is responsible for carrying out government functions, and avoiding perceptions — real or implied — that it is contractually obligated to fill the government’s role.

It is important to build relationships with local leaders, get counsel from social workers, educators, and others who have both the subject-matter expertise and an understanding of the local culture and local needs. Then, with their input, potential good-neighbour projects have a greater chance to change lives.

Mining companies cannot be a complete answer to poverty and development issues throughout the world. However, they have a role to play, and corporate social responsibility can ultimately help the industry meet its financial obligations.

Bob Roscoe is co-general manager, Southeast Missouri Mining and Milling Division and Doe Run Peru Cobriza mine, based in St. Louis, Miss. Don Roberts, is an associate in the Vancouver office of Golder Associates.