CHAPTER 9 SUSTAINABLE DEVELOPMENT: EMERGING CONCEPTS OF GOVERNANCE IN THE MINERALS INDUSTRIES
| Jurisdiction | Derecho Internacional |
(2001)
SUSTAINABLE DEVELOPMENT: EMERGING CONCEPTS OF GOVERNANCE IN THE MINERALS INDUSTRIES
Patricio Leyton
International Institute for Environment & Development
London, England
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PREFACE
The Mining Minerals and Sustainable Development (MMSD) project is a two-year effort, sponsored by some thirty of the world's principal mining companies, as well as a variety of labour, environmental, government and international organizations, to examine the role of the minerals sector in the global transition to sustainable development.1
The project, overseen by a balanced international panel of experts known as the project Assurance Group,2 will publish a draft report in December 2001, and after a period of public review and comment will then publish a final report in March of 2002. It is anticipated that the report will inform the deliberations of the heads of state at the Rio +10 Earth Summit, which will be held in South Africa later in 2002.
The authors are respectively the Director, and the Coordinator for Latin America of the MMSD project.
A number of important questions, including the issue of what "sustainable development" means in a more sophisticated sense, and specifically what it means in the minerals sector, which is largely based on production of non-renewable resources from finite deposits, are outside the scope of this paper. Views are those of the authors, and not necessarily those of the Mining Minerals and Sustainable Development Project, the International Institute for Environment and Development, the World Business Council for Sustainable Development, or anyone else.3
1.1 INTRODUCTION
The phenomenon of globalisation has created many new opportunities. It has also created a variety of challenges. Some of these challenges and opportunities are of particular importance to law and the legal profession, as they relate directly to issues of accountability: what are the rules, who makes the rules, and what incentives encourage compliance with the rules, all matters very familiar to lawyers.
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Understanding the purpose of this paper requires placing it in a framework. Those who work in the field of sustainable development framework are accustomed to speaking of "pillars" and "levels."
1.2 Pillars of Sustainable Development
Sustainable development is an idea that received wide attention at the time of the Brundtland Commission4 and the Rio de Janeiro Earth Summit of 1992,5 is a concept which unites four core sets of concerns into what is hopefully described as — and which may yet become — a single agenda. Those four concerns or "pillars" are:
• Economic development and poverty reduction, with particular emphasis on alleviating the condition of people and countries in extreme poverty.
• Social development, including conditions conducive to fulfilling human cultural potential and its expression by individuals and communities.
• Environmental protection, especially the preservation of the proper functioning of ecosystems and maintaining their productivity.
• Fostering systems of administration, governance, and institutions appropriate to achieve the first three goals in an open, transparent, and participative framework.
1.3 Levels for Action
As the complex problems of sustainable development have been analysed by numerous observers, it has become clear that a world based on a sustainable model of development cannot emerge without actions occurring simultaneously at distinct levels of human organization:
• There are parts of the problem that can only be solved by action at the global level.
• Effective action at the global level depends on and supports action at the regional level among groups of neighbouring countries with respect to their shared concerns.
• Action must be taken at the national level to solve problems identified at the national scale.
• Certain problems require action at the local level within nations.
• Other issues must be dealt with at a community level or a workplace level.
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• Finally, there are some parts of the transition that require action at the individual or household level.
1.4 This Paper
This paper deals with the potential options for addressing the problems of sustainable development at the global and broad regional levels. It addresses principally the fourth of the "pillars" of sustainable development: governance, law, institutions and administration. It focuses on concerns of the mining and minerals industries.
We must be absolutely clear that this paper is not in any way intended to promote or prefer one of the described alternatives over others. That discussion must be had, but it is not for the authors to decide which alternative is best, or indeed whether anything needs to be done at all.6
What we hope to do is provoke informed discussion of these issues. We are hardly the originators of these ideas, which are being discussed intensively in a number of forums.7 The pace of that discussion will accelerate as we approach the new 2002 Earth Summit of the world leaders in Johannesburg.
Our view is simply that these are of fundamental importance to the future of the industry, and particularly to those concerned with law and governance issues in the mining and minerals industries. The discussion of the problems and the options therefore should not be limited to a few professional participants in ratified international policy processes. It should be broadened to include a wide range of those most concerned, and whose experience and knowledge can help shape solutions appropriate for a sector they know intimately.
Perhaps, the next Earth Summit, in a major mining centre of the world principal mining countries, will be an auspicious forum for advancing the sustainable development agenda in the minerals sector.
1.4.1 What Are The Issues?
Our argument is founded on three basic premises:
• Issues of sustainable development are vital to the future of the minerals sector.
• Some problems of sustainable development can only be solved if there is action at the global or regional level.
Effective institutions capable of managing problems of sustainable development at the global or regional level have in general not sufficiently emerged.
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1.4.2 The Future of the Minerals Sector
In the increasingly globalized world, issues of poverty, economic and social development, and environment are reshaping the context in which the minerals cycle exists. They play a major role in determining whether the industry has what is referred to as a "social license to operate": whether there is land open to exploration, on which deposits which have been found can in fact be mined, whether the precautionary principle will be properly applied or instead used to place irrational bans on mineral products, whether communities will resist mineral development or become partners in it, and whether developing countries see the industry as a source of poverty or part of the solution to it.
The fact that the social license of the industry — particularly the mining end of the industry — is in jeopardy is hard to dispute in large parts of the world. Polls show mining companies are viewed like tobacco companies as industries with negative images. The industry has very low levels of trust with many important social groups with which it must act.
These concerns are very real and express themselves in innumerable ways: whether the best graduates choose the minerals industries or other careers, whether investors choose to hold mining stocks, how hard it is to get concessions or permits, and whether markets are open or closed, to name just a few.
Maintaining the industry's license to operate, and rebuilding trust, are therefore vital business issues. It is hard to see how there can be sufficient progress without some way of developing thoughtful, balanced, meaningful norms that (1) express what good practice is and is not, (2) help those inside and outside the industry to distinguish between those who are doing a good job and those who are not, and (3) provide some system of incentives for good performance.
These needs are principal drivers in the rapid changes in law and legal regimes at the national and local levels. They are also creating a very real pressure for some system of "rules of the road" at the international level.
1.4.3 Action at the International Level
Globalisation has created new stresses and new issues which require cooperation at a level beyond national territorial limits. Trade in endangered species cannot be controlled effectively if there are wide open markets in some countries creating irresistible economic incentives for their exploitation. The poorest countries simply do not have the resources to feed their people, or to support development, without trade, or aid, or some form of infusion of skills, money, equipment, materials from somewhere outside their borders. Control of global pollutants such as CFCs or greenhouse gases cannot be accomplished at a national level.
In the minerals industries there are a number of concerns which some have suggested need attention at a global level. These include, in the view of some observers, the lack of any mechanism to identify or reward those companies which are doing a good job at moving toward a more sustainable model, or to identify and impose sanctions on those whose conduct falls outside some accepted set of norms. Examples of the direction in which events
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are moving include the recent proposal to create a system for certification of diamonds as "conflict free."8
1.4.4 Lack of Suitable Institutions and Structures
National governments and national legal systems are sovereign within their spheres. However, those spheres have real and juridical limits. This has important consequences.
There are mining companies operating in conflict zones where it is...
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