ROGER BAXTER: Much to be done to ensure ethical conduct in mining and business
The Minerals Council wants its members to adhere to a programme that ensures respect for human rights and transparent relations
The concept of a Global Ethics Day, as October 21 is designated, might draw the response that “every day should be an ethical day”. That is absolutely correct. However, SA’s historical context, whether we are talking about the past 10, 100 or 300 years, gives us all — particularly the business world and government — cause to contemplate what it means, and to commit and recommit to ethical ways of operating.
We come from a long history where those who have wielded political and economic power acted in ways that cannot be described as ethical. The new era we entered in 1994 would, most of us hoped, represent a U-turn. In many ways it did. But we also know that our more recent history has been terribly scarred by incidents of unethical behaviour that have done more than direly damage reputations. It has damaged the ability of our economy to generate the investment, inclusive growth and jobs that are required for many more of our citizens to live decent lives.
Simply stated, the hollowing out of the capacity of the state and state-owned entities (SOEs) for nefarious purposes significantly weakened the competitiveness of the economy. We need to think here not only about the incidents of state capture we have seen unfolding over the past decade, which continue to be revealed at the Zondo inquiry and, regrettably, on the ground to this very day, hopefully at a reducing pace. All right-thinking South Africans wait in anticipation for the politicians and government officials who were party to depriving our country’s Treasury of all those billions of rand to be brought to book. But for every rand wasted by a state representative there was usually a private sector entity that was party to it.
Here we are not talking only about the Guptas, Bosasa and their ilk. There were also all those previously reputable auditors, consultants and others that colluded with them, lending their well-known names to the fraudsters and helping create the rationale and structures to carry out the deeds. They also provided auditors’ and other reports that appear to have ignored the unethical and criminal activities that were taking place.
While we cannot claim always to have met the standards we are advocating, the Minerals Council would like to believe it has taken some important steps on the journey. A decision we took in 2017 to halt engagements with the then mineral resources minister should, in hindsight, be seen as a willingness to speak truth to the holders of power in those dark days. More important for the industry’s longer-term efforts to leverage ethical behaviours are certain structural measures that have been put in place by the Minerals Council board.
Adherence to the membership compact was introduced in 2018 as a condition for membership. The first clause contains the requirement for “ethical business practices”. The remainder deals with the specific areas relevant to ethical business practices: health & safety; sustainable development; respect for human rights; risk management based on sound data and science; environmental performance; biodiversity and land-use planning; product design, use and disposal; community development; and transparent communication. All members are required to sign their commitment to all the content of the compact.
To take forward one of the most critical features of the compact, the Minerals Council board also approved a human rights framework that sets out in detail the measures required to be taken to ensure respect for human rights. We are well aware that merely proclaiming respect for human rights does not mean the aspiration is being fulfilled. Based on the UN Guiding Principles on Business and Human Rights, the requirements are quite onerous and complex. It will take time for companies to put all the structures and systems in place. The Minerals Council is providing guidance to members on this. We envisage that the time will come when adherence to the framework will become a mandatory condition for membership.
For Global Ethics Day 2020 the Minerals Council has called on its members to intensify its work in all of these fields, and in this way and any others to mark their recognition and support for the occasion.
• Baxter is CEO of the Minerals Council SA.
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