Sept/Oct 2010

Building an audience

For CIM Distinguished Lecturer David Rodier, CSR benefits everyone

By Robbie Pillo

David RodierFor over three decades, David Rodier has been working tirelessly to shape the global norm on corporate social responsibility (CSR) in the minerals industry. Formerly senior vice-president, environment safety and health for Noranda Inc., he served as the company’s representative on many CSR-related initiatives, including the World Business Council for Sustainable Development, the International Council for Mining and Metals, the Mining Association of Canada’s (MAC) Towards Sustainable Mining (TSM) initiative and the chemical industry’s Responsible Care program. After retiring in 2002, Rodier spent his time consulting on external outreach and sustainable development for Noranda Inc. until 2005, as well as for Hatch until 2007. Currently, as part of this season’s CIM Distinguished Lecturer Series, Rodier is looking at ways to manage risk through sustainable development principles in his presentation “Sustainable development — a passing fad or a strategic way forward?”

CIM: Starting off with the obvious question, is sustainable development a passing fad or a strategic way forward?

Rodier: If you allow it to be a passing fad, you let yourself be put at risk. Sustainable development will be a commercial differentiator — only the companies who are responsible will be allocated the permits to build new projects. Strategically, it is the process of looking at a business from a “risk and threat” perspective, and making plans to address the issues. And by risk, I mean trends that will impact the costs of a business, for example increasing energy costs. It is a way of analyzing the environment we are operating in and expect to be in, and doing things to avoid the anticipated negative impacts.

CIM: How do you respond to critics that say CSR is an insurance policy for image-sensitive companies buying protection from advocacy actions?

Rodier: CSR won’t save anyone without the performance record to show their progress. You can’t buy a good reputation; you have to earn it through performance.

CIM: So, then, CSR is not just a means for mining to improve its image; it is a strategy that goes beyond good corporate PR?

Rodier: CSR is not an image issue; it is a systematic way to help manage a company for the long term. CSR is not window dressing — if it is, it will fail miserably. It requires a commitment to transparency. The company’s reputation rests on performance not advertising. If the performance isn’t in evidence, the reputation will suffer. It has to become part of the corporate culture.

CIM: As you say, CSR requires a commitment to transparency. However, wouldn’t a company leave itself open to scrutiny by divulging any risks and safety issues related to a project?

Rodier: Without information, people start making up scenarios that are much worse than what the actual scenario is. One of the tenets of community outreach is to let people know your worst-case scenarios. It informs the community about what’s going on and forces your own management team to take the issues more seriously and try to eliminate some of these risks.

You also need to talk about the ins and outs: what the risks are, what you are going to do about them, how you manage the risks that you are not aware of, etc. Give them full access to your information; it opens up the right channels. Suddenly you are no longer the problem company, but an organization they can look up to.

CIM: One of the main points in your presentation is social strategy. How important is community outreach at the preliminary phase of development projects?

Rodier: It is a way to avoid possible impacts from community outrage. The sooner it is initiated, the better, and it allows you to develop a sense of common trust. It gives people the opportunity to ask pointed questions and voice their concerns at every phase of the project, instead of letting them fester. You are able to deal with any issues before they get blown out of proportion. In doing so, the community essentially becomes a partner. MAC’s work with communities has repeatedly demonstrated that the communities want our businesses to succeed, but not at the expense of health, the environment and long-term continuity issues. Their input is vital to establishing a balanced approach to development.

Community outreach also addresses the question of investor confidence because they can see that risks have been identified and dealt with. It will increase profits in the long term. All this community interaction at the beginning costs nothing. But if a big disaster occurs at the end of a project, it can get very expensive.

CIM: Switching gears to an industry hot topic, what are your thoughts on the controversial Bill C-300?

Rodier: I believe that it is not necessary, as anyone who has tried to get financing for a mine can tell you. The hurdles created by the Equator Principles, which the majority of major banks insist on as their risk management protection, achieve what the bill proposes. Putting unnecessary regulations on Canadian companies will discourage external investment and encourage the subsequent loss of jobs and sales of engineering equipment and technology. It will also push Canadian companies to direct these types of investments through offshore vehicles, if at all. Imagine if the U.S. government tried to do this to us in Canada? These same people would be howling sovereignty!

CIM: What is your advice to companies looking to make the transition to sustainable practices?

Rodier: If one is starting out it may seem an onerous task, but consider what you already have in place —maybe a safety program, an environmental program, a product quality program, your financial reporting regime, etc. Build on these and ask for help from your industry association(s) such as MAC, CCPA, ICMM, PDAC, the World Bank and CIM. It is a necessary step in the right direction.

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