July 25, 2013
“Are you going to have a cookie-cutter solution, or are you going to take the time to consider a range of options and design something that has impact?” asked DAI President and CEO Jim Boomgard, speaking to a room of extractive industry executives operating in Southern Africa.
The roundtable, recently hosted by DAI in its Johannesburg office, focused on building resilient communities and explored various solutions to the heightening tensions between resource companies and the communities in which they operate.
The relationships between Southern African mining companies and the surrounding communities have become increasingly volatile, sometimes descending into violence. The instability originates, in part, from an extractive industry whose sizable social investment is frequently perceived to be lacking in real impact. As one participant described it, “We spend R200 million on education, but we don’t know if we’re having an impact because we are just ticking boxes.”
This limited impact stems from an approach that is often driven by compliance concerns; separated from other initiatives such as local procurement, supplier development, and enterprise development; and designed with inadequate community engagement.
It is difficult to navigate community expectations in a context of decreasing commodity prices, limited municipal governments that too often fail to deliver expected services, and insufficient engagement between firms and communities. “Communities are becoming increasingly unhappy everywhere, but it is more apparent where there are mines because there is an expectation that companies can provide solutions,” said the community engagement manager of one extractive firm.
Participants also acknowledged that the challenges facing the industry are as much internal as external. “The mining companies need to engage in difficult conversations,” said one attendee. “The mindset must change.”
And they must get out of the reactive mode. “We put out fires instead of dealing with what is causing the fire,” said a participant. “It’s nice to wear the fire jacket, but eventually the water runs out or you get tired.”
DAI Stability Specialist Barb Lauer discussed building community resiliency based on long-term, and sustainable capacity development. Drawing on her experience in Liberia, Tunisia, Indonesia, and Afghanistan, Lauer said, “When there is an obstacle, even if it is resistance from the community itself, the resiliency approach is a way to bring the community in and work on building their capacity to do things for themselves.”
DAI’s “Resilience Framework” is an approach designed to strengthen communities’ ability to absorb and deal with systemic stresses such as inadequate medical care and high unemployment as well as unexpected shocks like labor strikes, violence, and resettlement. By collecting and analyzing both objective data and perceptions, Lauer said, it is possible to identify and analyze stressors and shocks that prevent communities from reaching their full potential.
Integral to the framework is a community-driven approach that requires both the community and the company to take ownership of the design, implementation, and evaluation of program activities and investment, thereby holding both parties responsible for achieving success.
DAI’s Ed Rackley, also a stability and resiliency practitioner, shared his experiences working in volatile communities. “Volatility is an absence of resiliency—it represents a break-down of relationships,” he said. “Resiliency emerges from long-term planning and strategy. It supports community growth and ownership by investing in a community instead of infrastructure, and it supports an exit strategy so that post-extraction, the community is left on its feet, not on its knees.”
The event concluded with the following key recommendations for the extractive industry:
• Make a plan. Develop a strategy as early as possible that takes a long-term view, spans the life cycle of the extractive site, is collaborative, and builds the absorptive capacity and resilience of the community.
• Play the long game. Recognize that laying the foundation for building resilient communities—a process that can take four to 50 years—is just the first step in a long process that will be designed and re-designed many times over.
• Build on trust. Foster trusting relationships with the community—and with other companies that allow for honest discussion of successes and failures—as the building blocks for better planned investments that will yield lasting, mutually beneficial impact.