Social Responsibility In The Mining Sector

Using an academic journal article as your source, identify and define the ‘social responsibility’ concept as it applies to an industry context of your choice (e.g. mining, finance, government etc.). Using examples, describe factors that can undermine social responsibility performance in your chosen industry context. Using examples, describe the tactics a manager can use to avoid the factors you have identified.

Concept of Social Responsibility

Environmental degradation is one of the problems facing every nation and organizations need to come up with measures that will ensure environmental sustainability. Organizations should not maximize profits for the sake of the environment. Firms need to strike a balance between profit motives and environmental conservation. To ensure the welfare of the society and the environment is taken into considerations, firms need to engage in social responsibilities. Social responsibility refers to the obligations that ensure that as the business in making economic progress, the welfare of the surrounding society is also valued (SAguinis, and Glavas, 2012, p.945). Organizations should always make decisions that are ethically right so as to avoid hurting the welfare of the society. The mining sector is one of the sectors that has contributed a lot to environmental and the involved companies need to engage in social responsibility initiatives. This essay is written to describe social responsibility in the mining sector and also to highlight factors which hinder social responsibility in the mining sector and provide recommendations to address the identified challenges.

Social responsibility is divided into four groups which include legal, economic, philanthropic and ethical responsibility. Legal responsibility ensures that companies in the mining sector follow the enacted laws and policies that regulate mining activities in the country. The involved company should have the required authority to conduct exploration and also obtain the needed licenses. Mining sectors cause air, water, and land pollution (Kim, et al.2012, p.784). The pollution is hazardous to human health and the mining company should ensure that proper inspection is conducted so as to improve the welfare of the society. Companies involved in mining activities also need to pay taxes and avoid tax evasion as the society will lose a lot of money which could be used to improve the welfare of the society. Ethical responsibility also ensures that the firms follow the enacted safety regulations so as to ensure safe working conditions for the workers.

The ethical responsibility ensures that the mining companies follow the enacted codes of conduct and conform to the culture of the society. The firm should always act right so as to avoid hurting the involved stakeholders. The company should follow the set codes of conduct established an organization to guide the behavior of employees without discrimination (Wang, and Bansal, 2012, p.1145). People in the society should be accorded equal opportunities when recruitment is taking place. No one should be discriminated on basis of gender. The company should ensure equality in the company and workers should not be harassed or intimidated. The company should also ensure that employees are not exploited as people should be paid the stipulated minimum wage. Employees in the firms in the mining industry should also under a conducive environment and not forced to work overtime without pay. Mining sector degrades the environment and the involved firms should follow the established laws and regulations to conserve the environment. This involves initiatives such as covering mining holes after finishing mining operations and also engaging in land reclamation activities so as to ensure environmental sustainability.

Social Responsibility in the Mining Sector

The economic aspect of social responsibility force the mining firms to balance between making profits and improving the welfare of the society and conserve the environment. Mining companies should provide employment opportunities in the society and help to reduce unemployment rates and poverty eradication (Kitzmueller, and Shimshack, 2012, p.65). The companies should also pay the workers fairly so as to improve their living standards and ensure economic prosperity. Mining sector requires a lot of labor and providing jobs helps to elevate the welfare of the society.

Philanthropic social responsibility involves the mining company donating a certain amount of money for a certain course in the society. The company offers scholarships to needy children in the society who are willing to pursue education. Philanthropic activities also involve sponsoring events in the society so as to ensure the events are more successful and entertaining (Zhao, et al.2012, p.284).  Organizing forums to educate members of the public on various issues affecting the society also forms part of the philanthropic social responsibility initiatives that the mining sector firms can engage in. The companies should improve the environment where they exist in because that is their civil duty as artificial persons.

Mining sector companies engage in social responsibility for various reasons and one of the main reason is to conserve the environment. Natural resources need to be protected so as to avoid the shortage of resources needed for production purposes. The firms engage in activities such as tree planting, land reclamation, covering of mining pits and constructing gabions to prevent soil erosion. These activities ensure that the damaged land is recovered and can be used for other economic purposes such as farming (Yin, and Zhang, 2012, p.308). Firms in the mining sector should be on the front line in carrying out environment conservation activities as the sector contributes to environmental degradation.

Social responsibility helps the company to improve the brand image of the company.  The mining sector for many years has been accused of labor exploitation in many nations. Blood diamonds which are mined by exploiting laborers from the society has tainted the image of the mining sector and the image of the sector can only be improved through engaging in various social responsibility initiatives (Dobele, et al.2014, p.152). Provision of labor and providing workers with a conducive working environment helps the sector improve its public image. Workers are also paid above minimum wages so as to improve the welfare of the society and also redeem the damaged image due to declining public image.

Social responsibility will also ensure that the mining sector firms enjoy good relations with the members of the society. This will help the firm to have access to the labor needed in the mining sector. This will enable the firm to carry out its activities as the sector requires a lot of labor which can only be available if the firms enjoy good relations with the society (McDonald, and Young, 2012, p.59). Social responsibility will also help in employee retention and this will enable the firm to operate smoothly as disruptions associated with employee turnover will be avoided. Good relations will also enable the firms engaging in mining to attract top talents in the society and have access to skilled labor (Campbell, 2012, p.141). This will enable the firms to have edge cutting solutions to various problems such as environmental sustainability in the mining sector. This will enable the organization to achieve the growth objectives and create value for the stakeholders.

Factors that can Undermine Social Responsibility Performance

There are various factors which may hinder firm in the mining sector from engaging in social responsibility. The factors include; greenwashing perceptions. Members of the public understand that the mining sector contributes a lot to environmental degradation. The environment pollution has led to global warming effects which have immensely affected the agricultural sector. The agricultural sector is viewed as the only sector that ensures environmental sustainability and any activities that affect it will not be tolerated by the society (Stecker, 2016, p.379). The notions make firms in the mining sector to avoid engaging social responsibility initiatives as the members of public view them as just publicity stunts. This makes mining sector firms to avoid such initiatives as they believe that fewer gains will be achieved compared to the financial resources invested in the activities.

Lack of proper laws and regulations to govern social responsibility disclosures when preparing statements for the members of the public. This enables many companies to avoid in environmental sustainability as there are no clear regulations that force organizations to account for all social responsibilities (Littlewood, 2014, p.52). Such loopholes will cause the firm to neglect environmental conservation measures and this will enable the firm to neglect social responsibility initiatives that help to improve the welfare of the society.

The managers in the firm can set aside funds that will help in creating awareness to members of the public that the mining sector plays a critical role in economic growth and it should be helped in all ways possible. This will help in avoiding the notion that social responsibility initiatives conducted by mining firms are mere publicity stunts. This will help to restore the reputation of the firms in the mining sector. The reputation will enable the mining firms to engage in social responsibility initiatives as the society appreciates the efforts made in trying to conserve the environment. The firm managers can also ensure that the organization follows all the laws and regulations guiding social responsibility disclosures so as to avoid penalties and fines imposed when an organization is found guilty. This will help the organization to embrace social responsibility initiatives as they have to disclose all the initiatives (Kansal, et al.2014, p.224). This will force the firm to improve the environmental sustainability measures so as to have good publicity and improve reputation.

In conclusion, social responsibility plays a critical role in ensuring that organizations in the mining sector conserve the environment and also improve the welfare of the society. Social responsibility has economic aspects, legal aspects, philanthropic aspects, and ethical aspects. Such responsibility forces the firms in the mining sector to act ethically so as to improve the welfare of the society. Social responsibility has various benefits which include brand recognition, good relations with the society, availability of labor, improved reputations and firm growth. Green washing perceptions and lack of laws and regulations that govern social responsibility affect social initiatives of the firm. Managers can use public awareness to help in avoid green washing perceptions in the society.  

References:

Aguinis, H. and Glavas, A., 2012. What we know and don’t know about corporate social responsibility: A review and research agenda. Journal of management, 38(4), pp.932-968.

Campbell, B., 2012. Corporate Social Responsibility and development in Africa: Redefining the roles and responsibilities of public and private actors in the mining sector. Resources Policy, 37(2), pp.138-143.

Dobele, A.R., Westberg, K., Steel, M. and Flowers, K., 2014. An examination of corporate social responsibility implementation and stakeholder engagement: A case study in the Australian mining industry. Business Strategy and the Environment, 23(3), pp.145-159.

Kansal, M., Joshi, M. and Batra, G.S., 2014. Determinants of corporate social responsibility disclosures: Evidence from India. Advances in Accounting, 30(1), pp.217-229.

Kim, Y., Park, M.S. and Wier, B., 2012. Is earnings quality associated with corporate social responsibility?. The Accounting Review, 87(3), pp.761-796.

Kitzmueller, M. and Shimshack, J., 2012. Economic perspectives on corporate social responsibility. Journal of Economic Literature, 50(1), pp.51-84.

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McDonald, S. and Young, S., 2012. Cross-sector collaboration shaping corporate social responsibility best practice within the mining industry. Journal of Cleaner Production, 37, pp.54-67.

Stecker, M.J., 2016. Awash in a Sea of Confusion: Benefit Corporations, Social Enterprise, and the Fear of “Greenwashing”. Journal of Economic Issues, 50(2), pp.373-381.

Wang, T. and Bansal, P., 2012. Social responsibility in new ventures: profiting from a long?term orientation. Strategic Management Journal, 33(10), pp.1135-1153.

Yin, J. and Zhang, Y., 2012. Institutional dynamics and corporate social responsibility (CSR) in an emerging country context: Evidence from China. Journal of business ethics, 111(2), pp.301-316.

Zhao, Z.Y., Zhao, X.J., Davidson, K. and Zuo, J., 2012. A corporate social responsibility indicator system for construction enterprises. Journal of cleaner production, 29, pp.277-289.