Corporate social responsibility in the mining industry: an exploration of host-communities’ perceptions and expectations in a developing-country

• Date: 03 December 2018
• Published date: 03 December 2018
• Pages: 1177-1195
• DOI: https://doi.org/10.1108/CG-01-2018-0006
• Author: Gideon Jojo Amos
• Subject Matter: Strategy,Corporate governance

Corporate social responsibility in the

mining industry: an exploration of

host-communities’perceptions and

expectations in a developing-country

Gideon Jojo Amos

Abstract

Purpose –The purpose of this paper is to explore how and what drivescorporate social responsibility

(CSR) in hostcommunities of mining companies in developingcountries.

Design/methodology/approach –To address this knowledge gap, this paper used Ghana as a test

case andconducted 24 in-depth interviews withparticipants drawn from mining hostcommunities.

Findings –The paper discovered thatwhile CSR is broadly understood and encompasses six thematic

categories in the mining host communities, there are emphases on philanthropic and environmental

responsibilities.Contrary to the evidence found in other studies, this paper discovered that CSR rhetoric

plays a more positive/significant role than so far explored in CSR research, as it incentivizes the host

communities to push for the fulfilment of their CSR expectations and/or CSR initiatives proposed by

miningcompanies.

Research limitations/implications –Quantitative studies are needed tostrengthen the findings from

the presentpaper.

Practical implications –Because developingcountries share similar socio-economicand geo-political

realities, the findings of this paper may be applicable not only for CSR advocates, but also for policy-

makersin developing countries.

Originality/value –The paper providesnew inputs from a developing country perspective to the current

debateabout the CSR performance of the extractiveindustry.

Keywords Ghana, Corporate social responsibility (CSR), Multinational enterprises, Host-communities,

Multinational mining companies

Paper type Research paper

Introduction

The intensification of economic globalization in recent past decades has energized

multinational enterprises (MNEs) to set-up production plants and also outsource

increasingly skilled operationsto developing countries (Levy and Kaplan, 2008;Muthuri and

Gilbert, 2011). Increased internationalization of firms, in turn, has resulted in calls for MNEs

not only to take greater responsibility for their impact on society (Moon and Vogel, 2008),

but also, increasingly, be involved in developing rules, norms and standards that define

their corporate social responsibility (CSR) behavior (Levy and Kaplan, 2008). A number of

factors explain the rise of CSR in the international business arena. Prominent among the

factors is the concern expressed over the power and influence of MNEs, and in particular,

their impact, in developing countries, on the natural environment, human rights and

employment (Levy and Kaplan, 2008). Given their global influence, MNEs are usually

Gideon Jojo Amos is based

at the Center for Innovation,

Entrepreneurship, and

Learning (CIEL) Research,

Halmstad University,

Halmstad, Sweden.

Received 4 January 2018

Revised 7 March 2018

Accepted 21 May 2018

DOI 10.1108/CG-01-2018-0006 VOL. 18 NO. 6 2018, pp. 1177-1195, ©Emerald Publishing Limited, ISSN 1472-0701 jCORPORATE GOVERNANCE jPAGE 1177

confronted with addressing stakeholder groups and social responsibility issues that inform

context-specific CSR practices in the environment in which they operate (Kolk and van

Tulder, 2010;Matten and Moon, 2008).

However, the implementation of CSR in developing countries has been shown to be more

complex in view of its western-centric tradition (Dobers and Halme, 2009;Visser, 2008).

This requires that context-specific issues are brought to light in understanding CSR actions

of MNEs in developing countries (Matten and Moon, 2008). As we know it, developing

countries do not share the same socio-economic, cultural and geo-political realities that

underpin CSR in developed countries (Blowfield and Frynas, 2005;Dobers and Halme,

2009;Visser, 2008). Visser notes, for example, that “CSR in developing-countries draws

strongly on deep-rooted indigenous cultural traditions of philanthropy, business ethics, and

community embeddedness” (Visser, 2008, p. 481). This suggests that in an empirical

setting characterized by “weak institutions and poor governance” (Matten and Moon, 2008,

p. 418), developing countries often expect MNEs, through their CSR practices, to act as “a

vehicle for development” (Idemudia, 2011, p. 7) and thereby provide social services (e.g.

roads, education, electricity, health care, etc.). In this regard, the willingness of MNEs in

developing countries to take CSR actions raises questions as to whether their CSR strategy

is driven by socio-economicpriorities (Dobers and Halme, 2009;Kolk and van Tulder, 2010)

or are mere public relations gimmick (Frankental,2001;Loughran et al., 2009).

In the specific case of multinational mining companies (MMCs) doing business in

developing countries, the aforementioned expectations of the society are even more

pertinent (Dong et al., 2014;Smith et al., 2012), as they strive to secure/maintain external

legitimacy (Levy and Kaplan, 2008).The question arises in terms of the extent to which CSR

practices of MMCs in developing countries apply the same standards adopted in the

developed world (Dong et al., 2014;Gifford and Kestler, 2008). Dong et al. (2014),for

example, note that, to improve their chancesof maintaining legitimacy, MMCs “tend to have

higher levels of social and environmental disclosures to mitigate the effects of large and

noticeable impacts on the environmentand society” (Dong et al., 2014, p. 60). At a practical

level, MMCs are also confronted withchallenges in relation to “why” and “what” to include to

balance the desire for CSR policy development and implementation at the different stages

of the mine life cycle (i.e. exploration, development and production and closures stages)

with the need “to adapt to local conditions” (Hitch et al., 2014, p. 54). Nonetheless, a

possible constraint could be a tendency of MMCs to replicate parent company CSR

practices without recourse to local socio-cultural priorities, which suggests preference for

“context-issues” over the habitual’ “content-issues”, as advocated by Idemudia when it

comes to CSR in the extractive industry(Idemudia, 2011).

Moreover, the role and impact of CSR by MMCs in developing countries remains one area

within CSR research where polarized positions have prevailed in recent years (Hilson,

2012). In particular, as awareness of host communities regarding CSR has increased in

recent times, it is crucial that we understandwhat this awareness means with respect to the

mining industry (Eweje,2006a, 2007;Hilson, 2012). Yet, few studies examine the

expectations of stakeholder groups when it comes to CSR practices of MNEs in developing

countries. Research that focus on CSR in the extractive industry and the expectations of

host communities in developing countries remains scarce with few exceptions (Akiwumi,

2014;Eweje,2006a, 2007;Frynas, 2005;Garvin et al., 2009;Mzembe, 2016;Smith et al.,

2012).

With the above in mind, and drawing on legitimacy theory and stakeholder theory, the

objective of this study is to help address the knowledge gap with regard to how mining host

communities in developing countries understand CSR and expect MMCs to address their

CSR expectations. This is achieved by analyzing the views members of mining host

communities have on the CSR initiatives of MMCs in Ghana (a developing country). This

research is guided by the following research questions:

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