1.3 Corporate social responsibility

Expectations on mining companies regarding their social and environmental impacts and contributions are rapidly changing. Single-sector solutions to poverty and sustainability challenges are not progressing fast enough, and increasingly companies are being called on to collaborate with government and civil society. Most recently, several extractive companies have been contributing to multi-stakeholder discussions to shape the sustainable development agenda, in drafting Rio+20 ‘The Future We Want’ and United Nations Sustainable Development Goals. The goals are the next generation of collective global action that succeed the United Nations Millennium Development Goals, which expired in 2015. With an increased corporate focus on integrated reporting, combined with the emerging discourse on creating shared value and the growing demand for improved social impact metrics, mining companies are under increasing pressure to incorporate more robust evidence of social value creation into their core business through corporate social responsibility agendas.

Increased focus on responsible business practices has emerged over recent years, with the endorsement of the United Nations Guiding Principles on Business and Human Rights in 2011 being a key milestone. Social performance reporting has become relatively commonplace among big multinational mining companies over the past decade. The advent of voluntary initiatives and frameworks such as the Global Reporting Initiative, the United Nations Global Compact and the Dow Jones Sustainability Index mean that there are many reporting frameworks available; a challenge for companies is to select how best to embrace and respond to them according to reporting needs and objectives.

An additional challenge is that existing reporting practices no longer fully address stakeholder expectations; there is increasing demand for greater disclosure of environmental, social and governance performance (Paul and Nieland 2013). Until recently, stakeholders (investors, customers, employees, NGOs, communities) have been content with disclosures that demonstrate a company’s commitment to responsible practices and to managing the social and environmental risks and impacts of its operations.

Increasingly, however, stakeholders are pushing to see evidence of the positive social contribution companies are making to society, while companies are recognising that social value is often critical to their social licence to operate, and to managing risk and creating long-term business value. Companies across all industries are thus being called upon to measure and report the social impacts of their business activities and corporate social responsibility initiatives. Often the need for a business case for particular components of the operation further compounds the challenge and calls for an approach to corporate reporting that not only measures social outcomes, but also promotes the delivery of social outcomes in a way that is strategically aligned with broader business objectives.

A recent evaluation of several leading reporting methods commonly used by Australian mining companies was undertaken to assess their ability to contribute to demonstrating sustainable social development (Bennett and Thom 2013). The following frameworks were selected for analysis, as they are those most commonly used by companies to report social performance at the corporate and site level.

  • Global Reporting Initiative: Sustainability Report (GRI)
  • United Nations Global Compact: Communication on Progress (UNGC)
  • Dow Jones Sustainability Index: RobecoSAM Corporate Sustainability Assessment (DJSI)
  • International Integrated Reporting Framework: Integrated Report (IR)
  • London Benchmarking Group: Community Investment Report (LBG)

The following site-specific framework and methodology were also included in the analysis:

  • Mining Association of Canada: ‘Towards Sustainable Mining’ Framework (TSM)
  • socioeconomic monitoring and assessment.

The performance of each of the frameworks was assessed against seven key criteria (Table 1, Table 2).

Table 1: Criteria for assessing frameworks



1. Ability to promote performance The extent to which the framework promotes social performance through both internal and external engagement and capacity building.
2. Sustainable outlook The extent to which the framework promotes a sustainable long-term outlook and approach to monitoring and promoting performance.
3. Social coverage The extent to which the framework focuses on the social issues considered material to both the company and its stakeholders.
4. Outcomes focus The extent to which the framework focuses on social outcomes (as opposed to inputs, processes and outputs).
5. Ease of application The extent to which the framework is easily accessible, adoptable and adaptable.
6. Reliability The reporting framework is mandatory for all Mining Association of Canada members, and content is externally verified, which ensures disclosure is a true representation of performance.
7. Business case The extent to which the framework makes the connection between social performance and the broader business strategy.

The results of the analysis show those frameworks that performed best against each of the abovementioned criteria.

Table 2: Reporting frameworks that performed best against each criterion




1. Ability to promote performance TSM The reporting process is conducted at site level, rather than corporate, which promotes broader internal engagement and operational accountability for social performance and enhances internal capacity building. It also promotes performance by aligning mining activity with the priorities and values of its communities of interest.
2. Sustainable outlook TSM The focus on management systems, the promotion of community participation and the progressive performance rating system based on incremental improvements to management approach promote a sustainable, long-term outlook.
3. Social coverage GRI Encompasses the widest range of social aspects and encourages companies to consider those social issues of significance both to stakeholders and to the company.
4. Outcomes focus LBG One of the only reporting frameworks to focus specifically on the measurement of social outcomes. Rigorous data requirements also enable companies to effectively evaluate social and business outcomes and identify opportunities for shared value creation.
5. Ease of application TSM Clear, succinct principles and frameworks coupled with a simple and progressive self-assessment protocol that can easily be implemented at site level. This simplicity renders it the most accessible, adaptable and adoptable of all the frameworks assessed.
6. Reliability TSM The reporting framework is mandatory for all Mining Association of Canada members, and content is externally verified, which ensures that disclosure is a true representation of performance.
7. Business case IR The reporting process calls for integrated thinking, collaboration and connectivity across the entire business. It also places social capital on the same plane as financial and environmental capital and provides a means for social development to be valued and integrated into the overall value of the company.

Despite the strengths outlined in several reporting frameworks and site-based methodologies above, no one framework alone is sufficient to drive sustainable development outcomes to the extent that would optimise returns on social investment and satisfy stakeholder expectations. Instead, a blended approach, that includes the following, is encouraged:

  • Site-based reporting that promotes community participation in planning and decision-making for social investments is critical for purposeful and material social outcomes, in combination with socioeconomic surveys that generate valuable data and ensure that local action is contributing to regional and international development indicators.
  • A mix of corporate reporting frameworks that link social investments to business strategy ensures a depth of focus on a range of social issues and illustrates the value and impact of those investments.
  • A multi-sectoral approach that promotes cross-sector collaboration strengthens local systems, capabilities and processes and tracks progress towards long-term sustainable development objectives.

Along with a blended approach to social investment and reporting, regular independent assurance, technical and behavioural training, and ongoing efforts to ensure company and leadership buy-in are critical to embedding strong social performance within mining companies. This should be reinforced by a values-driven culture that locates social and environmental risks and contributions within core business, as everybody’s business, not only the business of those that are closest to the issues.

Share this Page